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Fundamental & technical analysis of Chemical & Consumer Durables

RELIANCE LIFE INSURANCE LTD


OBJECTIVE
The project is based on the financial sector of the market. And with the help of the financial sector the dada of the companies are been compared. The main objective of this project is to find the difference between the 2 companies: 1-tata chemicals 2-gujrat alkalies and chemical industry And to find that which companies share is better to buy and which company is not good to buy shares.

INDUSTRY PROFILE
Broad term describing any marketplace where buyers and sellers participate in the trade of assets such as equities, bonds, currencies and derivatives. Financial markets are typically defined by having transparent pricing, basic regulations on trading, costs and fees and market forces determining the prices of securities that trade. Some financial markets only allow participants that meet certain criteria, which can be based on factors like the amount of money held, the investor's geographical location, knowledge of the markets or the profession of the participant. Financial markets can be found in nearly every nation in the world. Some are very small, with only a few participants, while others like the New York Stock Exchange (NYSE) and the forex markets trade trillions of dollars daily. Most financial markets have periods of heavy trading and demand for securities; in these periods, prices may rise above historical norms. The financial sector is in a process of rapid transformation. Reforms are continuing as part of the overall structural reforms aimed at improving the productivity and efficiency of the economy. The role of an integrated financial infrastructure is to stimulate and sustain economic growth. NILESH DINESH WAGH ARUNA MANHARLAL SHAH INSTITUTE MANAGEMENT & RESEARCH

Fundamental & technical analysis of Chemical & Consumer Durables

The growth of financial sector in India at present is nearly 8.5% per year. The rise in the growth rate suggests the growth of the economy he financial policies and the monetary policies are able to sustain a stable growth rate

TYPES OF FINANCIAL MARKET


Capital market
Capital market is market where individuals invest for a longer duration i.e. more than a year is called as capital market. The capital market has two segments mainly: a. DEBT SEGMENT : The Debt segment deals with debt paper like government bonds and corporate debentures b. EQUITY SEGMENT : The Equity segment deals with transactions in equity shares Capital market is important from the point of view of the investor as well as the entity requiring funds. The investor has saving or surplus funds which the investor would like to park in investment avenues giving good return and with the safety of funds. The entity requiring funds could be a company for expansion or growth and could be government of India for various welfare programs or for bridging the gap between budget revenue and expenditure. Therefore, capital market essentially is an intermediary between the investor and the entity requiring funds. Capital market divided into following parts:

PRIMARY MARKET
Primary market is form of capital market where various companies issue new stock. Primary market is a form of market where stocks and securities are issued for the first time by companies. Its called as IPO i.e. initial public offer. Only listed company can make IPO to investor. A company must have three years profits record for being eligible to make on IPO. At present the book building route is to be followed for an IPO where investors actually bid for shares at a price which is appropriates according to their judgment and therefore unlike in the past all appoints a lead book runner and the promoters along with the lead book runner stipulates a price banner. Investor can apply for the shares at any price within the price ban. The other entities involved in an IPO are underwritten to

NILESH DINESH WAGH

ARUNA MANHARLAL SHAH INSTITUTE MANAGEMENT & RESEARCH

Fundamental & technical analysis of Chemical & Consumer Durables

the issue bankers to issue and register to the issue. The lead book runner is responsible for coordinating THE ACTIVITIES OF ALL THE PARTICIPANTS. THE UNDERWRITERS PROVIDE AN INSURANCE TO THE ISSUE IN THE SENSE THAT if the public response is not adequate then the underwriter will take up the under subscription portion of the issue.

SECONDARY MARKET
The secondary market is for transacting shares of listed companies and therefore after an investor receives allotment in the primary market then he cancelled the shares in the secondary market. In the secondary market, the transactions are done on a T+2 settlement basis. It is called a rolling settlement. The investor whether he purchases or rolls the shares the settlement is done on T+2 bases. T stands for transaction day and therefore if the transaction day is a Monday the settlement would be on Wednesday. Settlement involves making payment for the shares sold. Time is very important in the stock market and therefore if shares are sold on the Monday then they must be transferred from the sellers account to the brokers account on or before commencement of the market on Wednesday. Any delay would entail optioning of shares.

MONEY MARKET
The money market is a segment of the financial market in which financial instrument with high liquidity and very short terms are traded. Money market is a short term for money investment where the duration of the debt paper is below 365 days. The majority of different papers range between one working day to 364 days. He major players in the money market are scheduled commercial banks, financial institution, insurance companies, and mutual funds. The shortest avenue for investment in the money market is the call money. Money market consist certificates of deposit (CDs), Call money, commercial paper, treasury bills, municipal notes, repurchase agreement. Money market investments are also called cash investments because of their short maturities. Following are some of the important money market instruments or securities.

(A)CALL MONEY:
Call money is mainly used by the banks to meet their temporary requirement of cash. They borrow and lend money from each other normally on a daily basis. It is repayable on demand and its maturity period varies in between one day to a fortnight. The rate of interest paid on call money loan is known as call rate. NILESH DINESH WAGH ARUNA MANHARLAL SHAH INSTITUTE MANAGEMENT & RESEARCH

Fundamental & technical analysis of Chemical & Consumer Durables

(B)TREASURY BILL:
Treasury bill is a promissory note issued by the RBI to meet the short-term requirement of funds. Treasury bills are highly liquid instruments that mean, at any time the holder of treasury bills can transfer of or get it discounted from RBI. These bills are normally issued at a price less than their face value; and redeemed at face value. So the difference between the issue price and the face value of the Treasury bill represents the interest on the investment. These bills are secured instruments and are issued for a period of not exceeding 364 days. Banks, Financial institutions and corporations normally play major role in the Treasury bill market.

(C) COMMERCIAL PAPER:


Commercial paper (CP) is a popular instrument for financing working capital requirements of companies. The CP is an unsecured instrument issued in the form of promissory note. This instrument was introduced in 1990 to enable the corporate borrowers to raise short-term funds. It can be issued for period ranging From 15 days to one year. Commercial papers are transferable by endorsement and delivery . The highly reputed companies (Blue Chip companies) are the major player of commercial paper market.

(D)CERTIFICATE OF DEPOSIT:
Certificate of Deposit (CDs) are short-term instruments issued by Commercial Banks and Special Financial Institutions (SFIs), which are freely transferable from one party to another The maturity period of CDs ranges from 91 days to one year . These can be issued to individuals, co-operatives and companies.

(E)TRADE BILL:
Normally the traders buy goods from the wholesalers or manufactures on credit. The sellers get payment after the end of the credit period. But if any seller does not want to wait or in immediate need of money he/she can draw a bill of exchange in favor of the buyer . When buyer accepts the bill it becomes a negotiable instrument and is termed as bill of exchange or trade bill. This trade bill can now be discounted with a bank before its maturity. On maturity the bank gets the payment From the drawee i.e., the buyer of goods. When trade bills are accepted by Commercial Banks it is known as Commercial Bills. So trade bill is an instrument, which enables the drawer of the bill to get funds for short period to meet the working capital need

SPOT MARKET
NILESH DINESH WAGH ARUNA MANHARLAL SHAH INSTITUTE MANAGEMENT & RESEARCH

Fundamental & technical analysis of Chemical & Consumer Durables

Investing in spot market is highly sophisticated, with opportunities for both big losses and big gains. In the spot market, goods are sold for cash and are delivered immediately. Prices are settled in cash on the spot at current market prices. The spot market is complex and dedicate and not suitable for inexperienced traders. A market in which commodities, such as grain, Gold, crude oil or RAM chips, are bought and sold for cash and delivered immediately. Also called cash market.

DERIVATIVE MARKET
The derivate is named so for a reason : its value is derived from its underlying asset or assets. A derivative is a contract, but in this case the contract price is determined by the market price of the core asset. If that found complicated, its because it is. The derivatives market adds yet another layer of complexity and is therefore not ideal for inexperienced traders looking to speculate. Examples of common derivatives: are forwards, futures, options, swaps and contracts for difference (CFDs). There are also many derivatives , structured products and collateralized, obligations available, mainly in the over the counter market, that professional investors, institutions and hedge fund managers use to varying degrees but that play an insignificant role in private investing.

FOREX AND THE INTERBANK MARKET


The interbank market is the financial system and trading of currencies among banks and financial institutions, excluding retail investors and smaller trading parties. While some interbank trading is performed by banks on behalf of large customers, most interbank trading takes place from the banks' own accounts. The forex market is where currencies are traded. The forex market is the largest, most liquid market in the world .The forex is the largest market in the world in terms of the total cash value traded, and any person, firm or country may participate in this market. There is no central marketplace for currency exchange trade is conducted over the counter. The forex market is open 24 hours a day, five days a week and currencies are traded worldwide among the major financial centers of London, New York, Tokyo, Frankfurt, Hong Kong, Singapore, Paris and Sydney. Until recently, forex trading in the

NILESH DINESH WAGH

ARUNA MANHARLAL SHAH INSTITUTE MANAGEMENT & RESEARCH

Fundamental & technical analysis of Chemical & Consumer Durables

currency market had largely been the domain of large financial institutions, operations, central banks, hedge funds and extremely wealthy individuals.

ROLE OF REGULATORY BODY


The SEBI is the regulatory authority in India. SEBI established under section 3 of SEBI Act. And this act made especially for protecting the interest of investor in securities and promoting the development and also for regulating, the securities market and for matters connected therewith and incidental thereto. SEBI has made rules and regulation to be followed by the financial intermediaries such as brokers, etc. SEBI looks after the complaints received from investors for fair settlement. It also issues booklets for the guidance and protection of small investors. SEBI has made rules and regulation to be followed by the financial intermediaries such as brokers, etc. SEBI looks after the complaints received from investors for fair settlement. It also issues booklets for the guidance and protection of small investors. To regulate and control the business on stock exchanges and other security markets. For this, SEBI keeps supervision on brokers. Registration of brokers and subbrokers is made compulsory and they are expected to follow certain rules and regulations. Effective control is also maintained by SEBI on the working of stock exchanges. To make registration and to regulate the functioning of intermediaries such as stock brokers, subbrokers, share transfer agents, merchant bankers and other intermediaries operating on the securities market. In addition, to provide suitable training to intermediaries. This function is useful for healthy atmosphere on the stock exchange and for the protection of small investors. To register and regulate the working of mutual funds including UTI (Unit Trust of India). SEBI has made rules and regulations to be followed by mutual funds. The purpose is to maintain effective supervision on their operations & avoid their unfair and anti-investor activities. Prime objectives of SEBI Protecting the interest of the investors in securities Promoting development of, and Regulating, the security market and for the matter connected therewith.

STATUTORY BODIES
1. RESERVE BANK OF INDIA: Reserve Bank of India is the apex monetary Institution of India. It is also called as the central bank of the country. The Reserve Bank of India was established on April 1, 1935 in accordance with the provisions of the Reserve Bank of India Act, 1934. The Central Office of the Reserve Bank was initially established in Calcutta but was permanently moved to Mumbai in 1937. Though originally privately owned, since nationalization in 1949, the Reserve Bank is fully owned by the Government of India. The preamble of the reserve bank of India is as follows: NILESH DINESH WAGH ARUNA MANHARLAL SHAH INSTITUTE MANAGEMENT & RESEARCH

Fundamental & technical analysis of Chemical & Consumer Durables

"To regulate the issue of Bank Notes and keeping of reserves with a view to securing monetary stability in India and generally to operate the currency and credit system of the country to its advantage." 2. SECURITIES AND EXCHANGE BOARD OF INDIA: SEBI Act, 1992: Securities and Exchange Board of India (SEBI) was first established in the year 1988 as a non-statutory body for regulating the securities market. It became an autonomous body in 1992 and more powers were given through an ordinance. Since then it regulates the market through its independent powers. 3. INSURANCE REGULATORY AND DEVELOPMENT AUTHORITY: The Insurance Regulatory and Development Authority (IRDA) is a national agency of the Government of India and are based in Hyderabad (Andhra Pradesh). It was formed by an Act of Indian Parliament known as IRDA Act 1999, which was amended in 2002 to incorporate some emerging requirements. Mission of IRDA as stated in the act is "to protect the interests of the policyholders, to regulate, promote and ensure orderly growth of the insurance industry and for matters connected therewith or incidental thereto."

PART OF THE MINISTRIES OF THE GOVERNMENT OF INDIA:


FORWARD MARKET COMMISSION INDIA (FMC): Forward Markets Commission (FMC)
headquartered at Mumbai, is a regulatory authority which is overseen by the Ministry of Consumer Affairs, Food and Public Distribution, Govt. of India. It is a statutory body set up in 1953 under the Forward Contracts (Regulation) Act, 1952 This Commission allows commodity trading in 22 exchanges in India, out of which three are national level.

PFRDA UNDER THE FINANCE MINISTRY: Pension Fund Regulatory and Development Authority
PFRDA were established by Government of India on 23rd August, 2003. The Government has, through an executive order dated 10th October 2003, mandated PFRDA to act as a regulator for the pension sector. The mandate of PFRDA is development and regulation of pension sector in India.

FINANCIAL PLANNING

NILESH DINESH WAGH

ARUNA MANHARLAL SHAH INSTITUTE MANAGEMENT & RESEARCH

Fundamental & technical analysis of Chemical & Consumer Durables

Financial planning means to prepare the financial plan. A financial plan is also called capital plan for the company. A financial plan is an estimate of the total capital requirements of the company. It selects the most economical sources of finance. It also tells us how to use this finance profitably. Financial plan gives a total picture of the future financial activities of the company. This all the financial planning in simple. A financial plan contains answers to the following questions: How much finance (short-term, medium-term and long-term) will be required by the company or an individual? From where this finance will be acquired (gathered)? In other words, what are the sources of finance? That is, owned capital (promoter contribution, share capital) and borrowed capital (debentures, loans, overdrafts, etc.). How the company will use this acquired finance? That is, application or utilization of funds. Financial plan is generally prepared during promotion stage. It is prepared by the Promoters (entrepreneurs) with the help of experienced (practicing) professionals. The promoters must be very careful while preparing the financial plan. This is because a bad financial plan will lead to over-capitalization or under-capitalization. It is very difficult to correct a bad financial plan. Hence immense care must be taken while preparing a financial plan in company. As well as an individual also can prepare the financial planning for their future requirement with help of available resources. It mostly did by financial planner.

TYPES OF FINANCIAL PLANNING


Short-term financial plan is prepared for maximum one year. This plan looks after the working capital needs of the company. Medium-term financial plan is prepared for a period of one to five years. This plan looks after replacement and maintenance of assets, research and development, etc. Long-term financial plan is prepared for a period of more than five year.

It looks after the long-term financial objectives of the company, its capital structure, expansion activities, etc.

NILESH DINESH WAGH

ARUNA MANHARLAL SHAH INSTITUTE MANAGEMENT & RESEARCH

Fundamental & technical analysis of Chemical & Consumer Durables

OBJECTIVES OF FINANCIAL PLANNING


a. Determining capital requirements- This will depend upon factors like cost of current and fixed assets, promotional expenses and long- range planning. Capital requirements have to be looked with both aspects: short- term and long- term requirements. b. Determining capital structure- The capital structure is the composition of capital, i.e., the relative kind and proportion of capital required in the business. This includes decisions of debt- equity ratio- both short-term and long- term. c. Framing financial policies with regards to cash control, lending, borrowings, etc. d. A finance manager ensures that the scarce financial resources are maximally utilized in the best possible manner at least cost in order to get maximum returns on investment.

IMPORTANCE OF FINANCIAL PLANNING


Financial Planning is process of framing objectives, policies, procedures, programmers and budgets regarding the financial activities of a concern. This ensures effective and adequate financial and investment policies. The importance can be outlined as1. Adequate funds have to be ensured. 2. Financial Planning helps in ensuring a reasonable balance between outflow and inflow of funds so that stability is maintained. 3. Financial Planning ensures that the suppliers of funds are easily investing in companies which exercise financial planning. 4. Financial Planning helps in making growth and expansion programmes which helps in long-run survival of the company. 5. Financial Planning reduces uncertainties with regards to changing market trends which can be faced easily through enough funds. 6. Financial Planning helps in reducing the uncertainties which can be a hindrance to growth of the company. This helps in ensuring stability a d profitability in concern.

ADVANTAGES OF FINANCIAL PLANNING


it will help you to obtain funding if you need it.

It will set out clearly the money that you need to put together to start the business and then to run it for a period. It will help prevent you from going into a business that will not be successful. It will highlight periods where your business may need extra financial help. It will help you to spot problems early so you can make plans for the necessary solution. (For example, it will highlight whether you are holding too much stock or whether your collection is less than it should be or that you will be short of cash at a particular time). It will inspire confidence in lenders and banks that you may have to approach for finance.

NILESH DINESH WAGH

ARUNA MANHARLAL SHAH INSTITUTE MANAGEMENT & RESEARCH

Fundamental & technical analysis of Chemical & Consumer Durables

DISADVANTAGES OF FINANCIAL PLANNING


It can take a lot of time. It can be a costly process because you will need the assistance of your accountant or financial adviser. A financial plan merely forecasts

INVESTMENT OPTION
In simple terms, Investment refers to purchase of financial assets. While Investment Goods are those goods, which are used for further production. Investment implies the production of new capital goods, plants and equipments. Mostly is basically earning something from the available saving with us through the different options like FD, Mutual Funds, LIC, PF, equity market, etc.

INVESTMENT OPTIONS GIVEN AS FOLLOWS:


1) MUTUAL FUND
Mutual Fund is an investment trust that collects money from investors having a common financial goal. The collected money is invested in various capital market instruments like shares, debentures and other securities. The income earned through these investments is shared with all the investors Growth Schemes: - To have good long term growth potential for company and industry. Balanced Schemes: - Combination of both stocks and bonds Income Schemes: - It Offers investors a regular income usually paid out in the form of monthly dividend

2) BANK FIXED DEPOSIT


Fixed Deposit (FD) is a financial instrument where an investment is made for a fixed period of time resulting in a higher rate of Interest in return. This is best suited for investors with a low risk Appetite

NILESH DINESH WAGH

ARUNA MANHARLAL SHAH INSTITUTE MANAGEMENT & RESEARCH

Fundamental & technical analysis of Chemical & Consumer Durables

3) NATIONAL SAVING CERTIFICATE


Scheme specially designed for Government employees, Businessmen and other salaried classes who are Income Tax assesses. No maximum limit for investment. Certificates can be kept as collateral security to get loan from banks. Investment up to INR 1, 00,000/- per annum Rate of interest 8.50%.

4) PUBLIC PROVIDENT FUND (PPF)


Public Provident Fund (PPF) is a statutory scheme by the Central Government of India. It is one of the instruments suitable for long term investment. PPF scheme is for a period of 15 years. The minimum investment required in a PPF account is Rs 500 per year and the maximum investment amount is Rs 70,000 per year.

5) STOCK MARKET
Stock Market is one of the interesting investment options. This is the investment option which offers a very high rate of return coupled with maximum risk. Based on information & analysis, future share prices are predicted but the probability of the share prices reaching the target price is always a 50:50 chance.

6) SILVER
Silver considered as a poor mans gold is one of the attractive investment option. Normally Gold is preferred over Silver by all investors. The silver market is much smaller in value than the gold market. Silver is a better investment in a bull market. Price of silver is driven by speculation and supply and demand. Silver price is significantly volatile. This is because of lower market liquidity, and demand fluctuations between industrial and store of value uses.

7) GOLD
Gold, the shining yellow metal is one of the most popular investment options. It is considered as a safe haven against all national, political and cultural crises majority of the financial planners recommends around 15- 20% allocation of the total portfolio to Gold NILESH DINESH WAGH ARUNA MANHARLAL SHAH INSTITUTE MANAGEMENT & RESEARCH

Fundamental & technical analysis of Chemical & Consumer Durables

8) UNIT LINKED INSURANCE PLANS (ULIPS)


Unit Linked Insurance Plans, popularly known as ULIPs, it is an investment option provided by Insurance Companies. It is a single contract comprising of insurance cover with an investment benefit.

9) REAL ESTATE
Real Estate refers to investment in immovable properties which includes land, buildings, flats etc. Investing in real estate involves the purchase of real estate and selling it for a profit.

10) ANTIQUE
Antiques are extremely vulnerable to fluctuations in public demand, so they are considered high-risk, speculative investments. Antiques have always been a solid investment.

PRODUCT OFFERED BY BROKING HOUSES


A brokerage house, also called a brokerage firm, is a company licensed to buy and sell stocks or securities. Acting as an intermediary between buyers and sellers, a brokerage house typically employs brokers who carry out the wishes of the firm's clients as they pertain to the trading of stocks. Broker services are usually provided on a commission basis. Commission amounts charged for the buying and selling of securities vary with each brokerage house. Often, the price per trade is indicative of the level of service the firm offers. For example, a brokerage house that charges fees on the lower end of the scale may not execute trades as quickly as one that charges higher fees. Likewise, a firm that charges higher commissions usually offers more personalized service. In addition to commissions, a brokerage firm may charge various other fees. These fees may include charges for transferring assets, closing an account, and wiring money. Additionally, a brokerage firm may require the payment of IRA custodian fees, as well as annual services charges and fees related to periods of account inactivity. Depending on the policies of the brokerage house, a client's account may also incur a fee for failing to meet a minimum required account balance. Several brokerage houses have come up with the prepaid products to attract investors and retain them. Typically, the concept of a pre-paid brokerage cost means paying an upfront brokerage and enjoying discounted rates on your broking transactions. Some brokerage houses also call this an annual maintenance contract (AMC).Large brokerage houses are keen on such schemes as their infrastructure keeps a check on costs while margins improve with a surge in the number of clients. Each brokerage house has a different pre-paid product. Some have pre-paid products starting from as low as. 2,000 a NILESH DINESH WAGH ARUNA MANHARLAL SHAH INSTITUTE MANAGEMENT & RESEARCH

Fundamental & technical analysis of Chemical & Consumer Durables

year, while for high end customers it could go up to. 1 lakh a year. Similarly, the validity of each pre-paid brokerage account could vary. There number of broking houses: 1) Share khan 2) Angel broking 3) Shushilfinance 4) Bonanza 5) Canmoney 6) HDFC Securities 7) Indian bull 8) ICICI Direct 9) Indian info line 10) Kotak Security 11) Motilal Oswal 12) Reliance money 13) SBI These are the some broking house in India & and they are offering different product to investors like mutual funds, equity, commodity, insurance & other.

1) MUTUAL FUNDS:
A mutual fund is an entity that pools the money of many investors its unit-holders to invest in different securities. Investments may be in shares, debt securities, money market securities or a combination of these. Those securities are professionally managed on behalf of the unit-holders, and each investor holds a pro-rata share of the portfolio i.e. entitled to any profits when the securities are sold, but subject to any losses in value as well. Benefits of investing through a mutual fund Professional Investment Management Diversification Low Cost Convenience and Flexibility Personal Service Liquidity Transparency Two Types of mutual funds schemes

Open ended(Open-ended schemes can issue and redeem units any time during the life of the scheme ) Closed ended(close-ended schemes cannot issue new units except in case of bonus or rights issue)

2) COMMODITY:

NILESH DINESH WAGH

ARUNA MANHARLAL SHAH INSTITUTE MANAGEMENT & RESEARCH

Fundamental & technical analysis of Chemical & Consumer Durables

A physical substance, such as food, grains, and metals, which is interchangeable with another product of the same type, and which investors buy or sell, usually through futures contracts. The price of the commodity is subject to supply and demand. Risk is actually the reason exchange trading of the basic agricultural products began. For example, a farmer risks the cost of producing a product ready for market at some time in the future because he doesn't know what the selling price will be. More generally, a product which trades on a commodity exchange; this would also include foreign currencies and financial instruments and indexes.

3) EQUITY:
There are two ways in which you can invest in equities through the secondary market by buying shares that are listed in Stock exchanges and through the primary market by buying shares that are offered to public by companies first time after listing in stock market. Broking houses do that on behalf of the investor of client of them.

4) INSURANCE:
They also provide insurance policy with different plans or the investors which helps them investor to earn more money. These are the some product which is offer by the many broking firms to the investors.

COMPANY PROFILE
Reliance Industries Limited (RIL) is Indias largest private sector company on all major financial parameters. It has emerged as the only Indian company in the list of global companies that create most value for their shareholders, published by Financial Times based on a global survey and research conducted by PricewaterhouseCoopers in 2004. RIL features in the Forbes Global list of worlds 400 best big companies and in FT Global 500 list of worlds largest companies. Reliance Info communication is the outcome of late Dhirubhai Ambanis dream of bringing about a digital revolution in India that will bring to every Indians doorstep an affordable means of information and communication. It founded by Mr D.Ambani. Reliance Industries Ltd is an India-based company. The company is India's largest private sector company on all major financial parameters. They are the first private sector company from India to feature in the Fortune Global 500 list of 'World's Largest Corporations' and ranks 117th amongst the world's Top 200 companies in terms of profits. The company operates world-class manufacturing NILESH DINESH WAGH ARUNA MANHARLAL SHAH INSTITUTE MANAGEMENT & RESEARCH

Fundamental & technical analysis of Chemical & Consumer Durables

facilities across the country at Allahabad, Barabanki, Dahej, Hazira, Hoshiarpur, Jamnagar, Nagothane, Nagpur, Naroda, Patalganga, Silvassa and Vadodara. The company operates in three business segments: petrochemicals, refining, and oil and gas. But after death of Mr.D.Ambani his both sons got separated and share their business and manage by themselves . and reliance capital is one of the small part of the reliance industries and its owned by Mr.Anil Ambani. Reliance Capital Limited (RCL) was incorporated in year 1986 at Ahmedabad in Gujarat as Reliance Capital & Finance Trust Limited. The name RCL came into effect from January 5, 1995. In 2002, RCL shifted its registered office to Jamnagar in Gujarat before it finally moved to Mumbai in Maharashtra, in 2006. In 2006, Reliance Capital Ventures Limited merged with RCL and with this merger the shareholder base of RCL rose from 0.15 million shareholders to 1.3 million. RCL entered the Capital Market with a maiden public issue in 1990 and in subsequent years further tapped the capital market through rights issue and public issues. The equity shares were initially listed on the Ahmedabad Stock Exchange and The Stock Exchange Mumbai. Presently the shares are listed on The Stock Exchange Mumbai and the National Stock Exchange of India. And 1200+ employees across the 162 location spread across the country at services purpose to try to complete vision of the company. The corporate Office at Goregoa, Mumbai has approximately 350 people belonging to these various functions. They are not in India but they moved all over the world. They moved to West Asia, South East Asia, Africa and Euroup

VISION
Reliance capital s vision isthe most profitable, innovation, and most trusted financial services company in India and in the emerging market.

MISSION
To create and nurture a world-class, high performance environment aimed at delighting our customers by providing endless financial products in all part of the country.

VALUES
Our growth and success are based on the ten core values of Care, Citizenship, Fairness, Honesty, Integrity, Purposefulness, Respect, Responsibility, Safety and Trust

NILESH DINESH WAGH

ARUNA MANHARLAL SHAH INSTITUTE MANAGEMENT & RESEARCH

Fundamental & technical analysis of Chemical & Consumer Durables

PROMOTER AND PROMOTER GROUP


Total Shares held Name of the Shareholder AAA Enterprises Pvt Ltd AAA Infrastructure Consulting & Engineers Pvt Ltd Sonata Investments Ltd Reliance ADA Group Trustees Pvt Ltd - Trustees of RCAP ESOS Trust Reliance Innoventures Pvt Ltd Kokila D Ambani Anil D Ambani Tina A Ambani Jaianmol A Ambani Jaianshul A Ambani Total Number 98,414,206 27,975,633 3,250,000 1,600,000 576,450 545,126 273,891 263,474 83,487 5 132,982,272 As a % 40.07 11.39 1.32 0.65 0.23 0.22 0.11 0.11 0.03 0 54.14

BOARD OF DIRECTORS
Mr. Amit Bapna chief financial officer Mr.Amitabh Mohanty-He.ad of debt stratergy Mr.Anup Rau-Chief executive officer and director Mr.Asokan Arumugam- Chief compliance officer Mr.Arun Hariharan-President, quality and knowledge mgt Mr.K.V.Srinivasan chief people officer Mr.K.Achuthan chief people officer Mr.Lav Chaturvedi- Chief risk Officer Mr.Madhusudan Kela- Chief investment officer Mr.Rakesh Jain Chief Executive Officer Mr. Sam Ghosh-chief executive officer Mr.shrirish Chitte-Chief Technology Officer Mr.Sundeep Sikka-Chief executive officer Mr.V.R.Mohan-president and company secretary Mr.Vikrant Gugnani- Chief executive officer

NILESH DINESH WAGH

ARUNA MANHARLAL SHAH INSTITUTE MANAGEMENT & RESEARCH

Fundamental & technical analysis of Chemical & Consumer Durables

PRODUCTS & SERVICES


EQUITY
The Equities markets offers range of investment opportunities and Reliance Securities bring along with the added advantage of innovative products to suite customers investment profile and help customers make the right decision.

IPO
IPOs have gained popularity owing to the fact that retail investors can become stake holders in the success of a company. From a company's perspective, IPOs help raise capital for growth or diversification as stipulated in the prospectus of the offer and the investors also get to become part owners of the company. Investing in IPOs is no more a hassle. You can invest in IPOs through us with ease

INSURANCE
Reliance Composite Insurance broking is the wholly owned subsidiary of Reliance Capital and an independent insurance broker offering complete insurance solutions and services to major corporate houses.

NRI OFFERINGS
Today, the Indian economy boasts a stable annual growth rate and booming capital markets. Top fund managers, investors and analyst are optimistic on long term, domestic demand driven growth story of India, supporting valuations and financial market outperformance. Reliance Securities with its extensive market reach, experience and cutting edge technology platforms, provides the perfect vehicle for customers to invest and benefit from the Indian markets. Reliance Securities is glad to introduce the most competitive products for the Non Resident Indian (NRI) audience, supported by a dedicated NRI investment team to cater to their investment needs. Currently reliance securities offer services to NRIs based in UAE, Kuwait, Bahrain, Singapore & Malaysia.

DERIVATIVES
If you trade on leverage - Derivatives are meant for you. Transact in Futures and Options on NSE Bye using reliance securities unique products to take advantage of intraday and long term position benefits. If any customer is an active trader and believe in making the most of market movements, reliance reports on derivatives can be useful to customers. As an advanced trader seeking information NILESH DINESH WAGH ARUNA MANHARLAL SHAH INSTITUTE MANAGEMENT & RESEARCH

Fundamental & technical analysis of Chemical & Consumer Durables

on futures, options and derivative strategies, advisory team of reliance can help you make informed investment decisions.

MUTUAL FUNDS
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NILESH DINESH WAGH

ARUNA MANHARLAL SHAH INSTITUTE MANAGEMENT & RESEARCH

Fundamental & technical analysis of Chemical & Consumer Durables

FUNDAMENTAL ANALYSIS OF CHEMICAL AND CONSUMER DURABLE GOODS


CHEMICAL SECTOR IN INDIA
Chemical sector of India is one of the oldest industrial sectors in India. It has contributed significantly towards the phenomenal growth of Indian industry and economy. The chemical sector of India directly or indirectly acts as a supplier of many of the commodities of daily use. It is extremely scientific in its approach and facilitates the provision of many of the important chemicals which are the basic materials for end-products like paper, leather, paint, varnish, textile, and so on. The chemical sector in India stands as the keystone of the agrarian and industrial development which provides support for other industries. The chemical sector of India is one of the major industries in the Indian economy. It is estimated to be worth around US$ 35 billion, which is almost 3% of the country's gross domestic product. The investment in chemical sector of India is around US$ 60 billion. It generates employment of about 1 million. The chemical sector of India provides around 13-14% of total exports and its total imports are about 8-9%. It is ranked 12th globally and 3rd in Asia. The per capita consumption of chemical industry products in India is .01% of the global average. It has transformed itself into an innovative and successful industry from being merely a chemical producer once upon a time. The chemical sector in India constitutes of small and large companies. There is a spree of restructuring activities in the chemical sector. With the emphasis on branch building, environmental friendliness, and product innovation, the chemical sector has increasingly moved towards customer orientation. Though India revels in the ample supply of basic materials, it would have to improve on the technological aspects and the capabilities of proper marketing to confront the global competition.

THE INDUSTRIES USING CHEMICALS AS RAW MATERIALS:


Dye Industry Pesticides Industry Pharmaceuticals Industry Paper Industry Detergent and Soap Industry Paints and Varnishes Industry Plastic Industry Cement Industry

PRODUCTION TRENDS
The Indian chemical industry includes both large scale and small scale units. The fiscal concessions granted to the small-scale units in the mid-eighties led to establishments of large ARUNA MANHARLAL SHAH INSTITUTE MANAGEMENT & RESEARCH

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Fundamental & technical analysis of Chemical & Consumer Durables

number of units in the Small Scale Industries (SSI) sector. Currently, the Indian chemical industry is in the midst of a phase of major restructuring & consolidation. With the shift in emphasis on product innovation, brand building & environmental friendliness, this industry is moving towards greater customer orientation. Even though India enjoys an abundant supply of raw materials, it will have to build upon technical services & marketing capabilities to face global competition and increase its share of exports. As the Indian economy was protected till the early nineties, very limited large scale R&D was undertaken by the chemical industry to create intellectual property. The product patent regime came into force w.e.f. January 2005. Accordingly, units have to be more effective with state of the art R&D establishments. This will help in the development of newer molecules. With a number of scientific institutions, the countrys strength lies in its large pool of highly trained scientific personnel. India also produces a large number of fine & specialty chemicals, which have very specific uses & find wide uses as food additives, pigments, polymer additives, anti-oxidants in the rubber industry, etc.

PRODUCTION OF SELECTED MAJOR CHEMICALS


Sector Production (in 000 Metric Tonne) Growth CARG 201112/05-06 2.94 - 1.46 -2.61 4.14 9.95 1.71

2007-08 2008-09 2009-10 2010-11 Alkali Chemicals Inorganic chemicals Organic Chemicals Pesticides (Tech.) Dyes & Dyestuffs Total Major Chemicals 5443 609 1552 102 117 7823 5442 512 1254 105 110 7423 5602 518 1280 104 149 7651 5891 572 1342 111 164 8170

2011-12 6113 574 1396 120 171 8374

2012-13 upto sep 2973 267 656 60 86 4041

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ARUNA MANHARLAL SHAH INSTITUTE MANAGEMENT & RESEARCH

Fundamental & technical analysis of Chemical & Consumer Durables

MAJOR CHEMICAL GROUPS & SEGMENTS PRODUCED IN INDIA


Alkali - The Chloro Alkali industry consists of Soda Ash, Caustic soda and liquid chlorine. Caustic soda, finds use in various applications, such as, finishing operations in textiles, manufacture of soaps and detergents, control of pH (softening) of water for various applications and general cleansing or bleaching applications. Glass manufacturing is the largest application for soda ash. Liquid chlorine is used primarily for various bleaching applications, across paper and pulp, textiles and other industries.

COMPOSITION OF CHLORO ALKALI INDUSTRY

36%

40%

Soda Ash Liquid Chlorine Caustic Soda

24%

Inorganic chemicals - The key organic chemicals are titanium dioxide, carbon black, and calcium carbide. Other inorganic chemicals include aluminium fluoride, potassium chlorate, red phosphorous, and sodium chlorate. The industry caters to a host of end user industries such as paints and dyestuff, tyres, leather, paper, detergent, explosives, rubber chemicals, cigarette, etc.

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ARUNA MANHARLAL SHAH INSTITUTE MANAGEMENT & RESEARCH

Fundamental & technical analysis of Chemical & Consumer Durables

COMPOSITION OF INORGANIC INDUSTRY


4% 11%

15%

Titanium Dioxide Calcium Carbide Carbon Black Others

70%

Organic chemicals Organic chemicals are a group of petroleum-derivative chemicals used as intermediates to produce other chemicals, which, in turn, are used to manufacture a wide variety of end-use products, including construction materials, apparel, adhesives, plastics,and tyres. The majority of the organic chemicals are derived from benzene, a petroleum derivative. The key organic chemicals are acetic acid, methanol, formaldehyde, acetaldehyde, chloromethane, phenol, benzene and its derivatives (that include nitrobenzene, aniline, ortho nitro chlorobenzene (ONCB), para nitro chloro-benzene (PNCB). Pesticides - With expanding agricultural production supported by good monsoons, improvement in technology and growing awareness among farmers, the consumption of agrochemicals has been on the upswing. The agrochemicals industry is made up of insecticides (74%), herbicides (20%) and fungicides (6%). Cotton, paddy or rice, vegetables and fruits account for over 80% of the pesticide consumption in the country. While cotton is planted on about 4.5-5% of the total cultivable area (on about 9.3-9.6 million hectares or mha), it accounts for about 33% of pesticide consumption in India, followed by rice (23%), vegetables (9%), wheat (8%), and pulses (6%). India is one among the most dynamic generic pesticides manufacturing countries with a total market size of Rs 8,900 crore per annum. And yet, Indias own average consumption of pesticides is very low at 480 gm per hectare which results in crops worth about Rs 12,000 crore being destroyed annually by pests.

Fertilizers The Indian chemical fertiliser (hereafter referred to only as fertilisers) industry mainly concerns itself with providing the three primary nutrientsN, P, and Kto the ARUNA MANHARLAL SHAH INSTITUTE MANAGEMENT & RESEARCH

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Fundamental & technical analysis of Chemical & Consumer Durables

agricultural sector. While nitrogen is expressed in the elemental form (N), phosphorous and potassium are expressed as their oxide forms, viz. phosphate (P2O5) and potash (K2O). Besides, being used as fertilisers themselves, these three nutrients are combined to produce several complex fertilisers.

SHARE OF NUTRIENT OF TOTAL FERTILIZER COMPOSITION


12%

Nitrogen 24% 64% Phosphorous Potassium

Dyes & Dyestuff - The consumption of Dyes and Dyestuffs is closely related to the performance of the textile industry. Organic pigment colours account for the largest share of dye industry followed by sulphur dyes and Azo dyes.

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ARUNA MANHARLAL SHAH INSTITUTE MANAGEMENT & RESEARCH

Fundamental & technical analysis of Chemical & Consumer Durables

COMPOSITION OF DYE & DYESTUFF INDUSTRY

21% Organic pigment colours Sulphur Dyes 11% 50% Azo dyes Others 18%

Petrochemicals - Petrochemicals are chemical products made from raw materials of petroleum (hydrocarbon) origin. The distillation of crude oil yields naphtha, gas oil, natural gas (NG), and petroleum gases which are mainly used as feedstock by the petrochemicals industry. The cracking (process whereby complex organic molecules are converted to simpler molecules) of naphtha/NG yields six major petrochemicals. These are olefins such as ethylene, propylene, and butadiene; and aromatics such as benzene, toluene, and xylene. While NG-based crackers invariably produce light olefins (mainly ethylene), naphtha-based crackers have a higher share of propylene and aromatics (benzene and xylenes). Indias petrochemicals production facility presently is categorised into five groups as in the figure below. Polymers are the largest segment of the Indian petrochemicals industry, accounting for around 64% of Indias aggregate production of major petrochemicals, followed by synthetic fibres (26%).

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ARUNA MANHARLAL SHAH INSTITUTE MANAGEMENT & RESEARCH

Fundamental & technical analysis of Chemical & Consumer Durables

COMPOSITION OF PETROCHEMICAL INDUSTRY

28%

Polymers Elastomers Surfactants

1%

7% 1%

63%

Performance Plastics Synthetic Fibres

REGIONAL CONCENTRATION OF THE BASIC CHEMICALS INDUSTRY

Though the chemical industry is spread across the country, there is relatively a high concentration along the west-coast, largely due to the proximity to raw materials and ports. Gujarat alone is estimated to contribute around 53% to the total production in the country, followed by Maharashtra, which contributes 9%. The other major producing states include UP, TN, MP and Punjab. On the other hand, in the case of heavy chemicals segment, especially inorganic chemicals, fuel availability is a determining factor, and hence there is a concentration of these companies around power plants. Due to the regional NILESH DINESH WAGH ARUNA MANHARLAL SHAH INSTITUTE MANAGEMENT & RESEARCH

Fundamental & technical analysis of Chemical & Consumer Durables

concentration of chemical companies in certain pockets, logistics costs for the industry have tended to become a significant position of total costs.

INDEX OF INDUSTRIAL PRODUCTION


The production performance of Chemical & Chemical products is also used for performance in Indian Industrial growth. The weight of Chemical & Chemical Products is 100.59 out of 1000 in the Index of Industrial Production. The Index of Industrial Production for the chemical & chemical products sector for the month of September 2012 stands at 127.3% which is 1.7% higher as compared to the level in the month of September 2011. The cumulative growth in general IIP during April- September 2012-13 over the corresponding period in 2011-12 has been 0.1%, as against the growth -0.3% in case of manufacturing & 2.3% in case of chemical & chemical products. The behavior of IIP of Chemical & Chemical products during 2005-06 to 2011-12 is depicted in following chart.

AVERAGE ANNUAL INDICES OF INDUSTRIAL PRODUCTION

200 180 160 140 120 100 80 60 40 20 0 2005-06 2006-07 2007-08 2008-09 2009-10 2010-11 2011-12 Chemical & ChemicalProducts Manufacturing General

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ARUNA MANHARLAL SHAH INSTITUTE MANAGEMENT & RESEARCH

Fundamental & technical analysis of Chemical & Consumer Durables

WHOLESALE PRICE INDEX (WPI)


The weight of Chemical & Chemical Products in terms of movement of WPI is 12.02 out of all commodities weight of 100. The movement of WPI for Chemical & Chemical Products sector during the years 2005-06 to 2011-12 is shown in following chart.

WPI FOR CHEMICAL & CHEMICAL PRODUCTS VISA-VIS OTHER COMMODITIES

250

200

All Commodities Food Articles

150

Manufactured Products Chemical & Chemical Products

100

50

0 2011-12 2010-11 2009-10 2008-09 2007-08 2006-07 2005-06

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ARUNA MANHARLAL SHAH INSTITUTE MANAGEMENT & RESEARCH

Fundamental & technical analysis of Chemical & Consumer Durables

TRENDS IN EXPORT OF MAJOR CHEMICALS & PETROCHEMICALS


140000 120000

Rs. in 100000 Crores 80000


60000 40000 20000 0 2006-07 2007-08 2008-09 2009-10 2010-11 61152 65681 77964 84220 103883

135067

2011-12

TRENDS IN EXPORT OF MAJOR CHEMICALS & PETRO-CHEMICALS


140000 120000

Rs. in 100000 Crores 80000


60000 40000 20000 0 2006-07 2007-08 2008-09 2009-10 2010-11 61152 65681 77964 84220 103883

135067

2011-12

KEY PLAYERS IN CHEMICAL SECTOR


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Fundamental & technical analysis of Chemical & Consumer Durables


M/s.United Phosphorous Ltd, Mumbai M/s. P.I.Industries, Jaipur M/s.BASF India, Mumbai M/s.BASF India, Mumbai M/s. Excel India, Mumbai M/s.Atul Ltd., Bulsar M/s. Colour Chem Ltd., Mumbai M/s. Sudarshan Chemical Industries, Pune M/s.Colourtex, Ahmedabad M/s. Monsantu Chem Ltd., Mumbai M/s. Jubilant Organosys Ltd., New Delhi M/s. Herdilia-Schentady Ltd. Mumbai National Organics Chemicals Ltd., Mumbai DCM Sri Ram Consolidation Ltd., New Delhi M/s. Gujarat Heavy Chemicals Ltd., Ahmedabad M/s. India Glycols Ltd., New Delhi M/s. Gujarat Alkalies and Chemicals Ltd., Baroda M/s.Rayalseema Chemcials, Hyderabad

STRATEGIC ANALYSIS
THREAT OF NEW ENTRANTS
It is relatively easy to enter the chemical industry for a new player as there are very less barriers and encouragement from the government in the form of fewer regulations. The government has allowed 100% FDI, which encourages foreign players to enter this sector. As the sector is comprised of many small scale companies, there is bound to be cut-throat competition. High prices of feed stock are seen as the major barrier to entry. In addition to this environmental concerns & dumping issues force the new companies to rethink their entry. Many chemicals are still reserved for production under small scale sector, which becomes a disadvantage for large companies.

POWER OF SUPPLIERS
Chemical industry relies on supplies from a few large corporations (such as those in petrochemicals industry) Chemical producers have limited substitutes for inputs Most suppliers are not dependent on their sales to chemical manufacturers.

BARGAINING POWER OF BUYERS


Those in chemical industry have many end-customers; dont rely on one customer The products (chemicals) are not greatly differentiated ARUNA MANHARLAL SHAH INSTITUTE MANAGEMENT & RESEARCH

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Fundamental & technical analysis of Chemical & Consumer Durables

Usually purchased through long-term contracts, so switching costs are high

COMPETITIVE RIVALRY
The degree of rivalry is generally high in the chemical industry, which in the commodity business has lead to domination by price considerations and pressure to increase productivity. Furthermore, there is a strong incentive to innovate for increased efficiency on the one hand, and for differentiation in the specialty chemicals and biotech businesses on the other hand, which in some cases have led to the development of niche markets with less rivalry. This is also reflected in the extensive array of company types, with certain chemical companies belonging to the largest companies in the world, but the majority of chemical companies being relatively small in size. With the larger companies producing major quantities of a variety of chemicals, and the smaller companies manufacturing only a few or even one single special product, the large corporations account for the major volume of chemicals sold, with the total of small producers accounting for the majority of different types of chemicals sold. As globalization is still intensifying, the chemical industry has seen a lot of restructuring, mainly within the top companies as well as for the whole industry, leading to an increased concentration of the industry. The complexity of the relations within the chemical industry is further reflected in the trade balances between the producing companies and countries. A major part of the national chemicals production is sold locally and another big part is sold within OECD countries. Most of the purchases and in particular the sales by non-OECD countries have only been rising significantly within the last two decades. Some other features of the chemical sector are Large number of competitors all competing for market share All are global competitors[Symbol] little room for expansion All benefiting from economies of scale, so competing on price Little differentiation among current players High fixed costs, and high exit costs

THREAT OF SUBSTITUTES
Buyers tend to need specific chemicals as inputs There really are no similar substitutes for chemicals Even if another chemical can be used, it is most likely produced by the same Industry Players.

INDUSTRY LIFE CYCLE


The chemical industry can be seen to be at a shakeout stage. It is past the growth stage but not yet reached the maturity stage.There is relatively steady growth & intense completion in this sector. Still this sector has scope for growth due to continuous demand in the local as well as foreign markets.

GROWTH DRIVERS
The chemical industry forms the backbone of the Indian manufacturing base. Some key strengths of the sector that can drive growth for the industry include low cost manpower, large domestic market, strong forward and backward linkages and conducive policy environment.

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ARUNA MANHARLAL SHAH INSTITUTE MANAGEMENT & RESEARCH

Fundamental & technical analysis of Chemical & Consumer Durables

Considering the vastness of this sector, some of the common growth drivers that could be identified for the sector include: (A) MACROECONOMIC FACTORS Being largely an intermediate product, a strong economic growth is an important factor for sustaining demand for the chemical industry. In fact, the per capita consumption of most of the finished products under this sector is far below the world average, giving a hint to the potential growth for the industry. (B) INTEGRATION ALONG THE VALUE CHAIN The industry participates in different stages of the value chain by producing intermediates and finished goods. This makes integration of processes easier. In fact, growing competition in select chemical segments has forced the industry to scale up production, which, inter-alia, requires backward or forward integration in some cases. Higher consolidation and capacity building has driven growth. (C) FOCUS ON R&D Specialty and fine chemicals are essentially a knowledge-based industry, which requires sustained investment in R&D. During the past few years, the chemical industry has witnessed a rise in R&D and technology up-gradation. This has led to many new products being introduced in the market, thus boosting demand. (D) OUTSOURCING AND CONTRACT MANUFACTURING On the strength of low-cost production and world-class technology, India is being looked upon as a preferred destination for outsourcing and contract manufacturing. This has led to higher utilization of capacity and revenue generation for the participants.

CHALLENGES
The Indian chemical industry today is emerging from a protected environment into highly competitive global market, and at the same time the domestic market is already reaching a mature level where demand potential for chemical end-products is on the rise. In these changing circumstances, the industry faces some key challenges.

(A) POWER COSTS

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Fundamental & technical analysis of Chemical & Consumer Durables

Chemicals, especially heavy chemicals, are power intensive sectors, and sustained supply of power is imperative. Volatility in power supply and prices of crude oil has been impacting the margins of the chemical companies.

(B) TECHNOLOGY
Although India has shown remarkable improvement in technological innovation, it still lags behind international standards. Chemical sectors are one, where technological changes are rapid and needs continuous up-gradation and innovation.

(C) INFRASTRUCTURE
Poor infrastructure, like roads, rail and ports are other detrimental factors. Regional concentration of the chemical industry requires better infrastructure and logistics to reach across the country.

(D) DUMPING
Growing international competition and low customs duty on some of the chemicals have led the dumping of certain chemicals in domestic industry. Notably, most of the cases related to anti-dumping duty in India relates to chemical sector.

BUDGET PROVISIONS
The following announcements have been proposed in the Union budget 2013-14 No change in the peak rate of basic customs duty of 10% for non-agricultural products. No change in the normal rate of excise duty of 12% and the normal rate of service tax of 12% Surcharge increased from 5% to 10 % on domestic companies whose taxable income exceeds Rs 10 crore. In the case of foreign companies, who pay the higher rate of corporate tax, the surcharge will increase from 2% to 5%. NILESH DINESH WAGH ARUNA MANHARLAL SHAH INSTITUTE MANAGEMENT & RESEARCH

Fundamental & technical analysis of Chemical & Consumer Durables

In all other cases such as dividend distribution tax or tax on distributed income, current surcharge increased from 5% to 10%. Additional surcharges will be in force for only one year i.e. FY14 Education cess for all tax payers shall continue at 3% Companies investing Rs 100 crore or more in plant and machinery during the period 1.4.2013 to 31.3.2015 will be entitled to deduct an investment allowance of 15% of the investment. Concessional rate of tax of 15% on dividend received by an Indian company from its foreign subsidiary proposed to continue for one more year. Further, the Indian company shall not be liable to pay dividend distribution tax on the distribution to its shareholders of that portion of the income received from its foreign subsidiary. Increase the rate of tax on payments by way of royalty and fees for technical services to non-residents from 10% to 25%. However, the applicable rate will be the rate of tax stipulated in the DTAA (Double Tax Avoidance Agreements) Work on draft GST Constitutional amendment bill and GST law expected to be taken forward. sum of Rs 9,000 crore is set apart in the budget towards the first instalment of the balance of CST compensation A final withholding tax at the rate of 20% on profits distributed by unlisted companies to shareholders through buyback of shares

BUDGET IMPACT
No direct impact on Chemical industry.

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ARUNA MANHARLAL SHAH INSTITUTE MANAGEMENT & RESEARCH

Fundamental & technical analysis of Chemical & Consumer Durables

TATA CHEMICAL INDUSTRY

Company background:
1939
- The Company was Incorporated on 23rd January, at Mumbai. The Company Manufacture salt, byproducts of salt, alkalies, heavy chemicals and insecticides and flux technical and battery grades. - 37,000 equity shares issued without payment in cash.

1978
- The expansion of Soda Ash capacity from 3,60,000 to 5,00,000 tonnes per annum was completed.

1982
- The Company proposed to take up production of phosphatic fertilizer through its wholly-owned subsidiary, Tata Fertilisers, Ltd. at a complex planned to be set up at Babrala in U.P. The Company subscribed to an initial amount of Rs 30 crores in the shares capital of Tata Fertilisers, Ltd.

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Fundamental & technical analysis of Chemical & Consumer Durables

- 30,00,000 equity shares (prem. Rs 10 per share) and 36 shares (prem. Rs 2 per share) allotted to 13.5% and 10.5% convertible bond holders respectively.

1983
- The Company issued 13.5% secured rights convertible bonds of Rs 100 each aggregating Rs 30 crores. Out of this, Rs 26.27 crores were issued to equity shareholders in the proportion of one bond for every four equity shares held and the balance of Rs 3.73 crores was issued to employees, associates, friends, preference shareholders and deposit holders. An amount of Rs 20 per bond was compulsorily and automatically convertible into one equity share on 1.11.1983. The portion of Rs 40 each are redeemable at the end of 10 years. However, these bond holders were given the right to apply for one equity share for every part of Rs 40 upon payment of Rs 40 in cash separately during 1st November, 1984 and 30th April, 1988. - The Company formed a 100% investment subsidiary, with a paid-up capital of Rs 20 lakhs, in the name and style of General Investment & Trading Company Private Ltd.

1984
- The Company made a rights issue of 15% non-convertible debentures of the face value of Rs 35 crores to meet a part of the capital expenditure on various schemes of modernisation and rehabilition. The issue was oversubscribed and the CCI accorded consent for the Company to retain a further amount of Rs 17.5 crores. These are redeemable in three annual instalments commencing 9th May, 1992. - The holders of 29,73,268 bonds of Rs 80 each applied for 59,46,536 equity shares. Out of these 18,69,739 shares were allotted with effect from 1st January, 1985 and the remaining 40,76,797 shares were allotted on 1st April, 1985. By appropriating the sale proceeds of `B' and `C' portions of these convertible bonds or receiving share amount and premium, the following equity shares were allotted at a premium of Rs 30 per shares: (i) 4,014 shares during 1986-87; (ii) 3,162 shares on 10th April, 1987; (iii) 1,141 shares on 1st July, 1987, (iv) 474 shares on 1st October, 1987 and (v) 790 shares on 1st January,

1988. 1985
- The Company also issued 15% non-convertible debentures aggregating Rs 10 crores to the Unit Trust of India. These are redeemable at a premium of 5% on 19th August, 1992. The date of redemption was extented for a further period of 7 years at an enhanced rate of 19% per annum. - 40,76,797 Equity shares (prem. Rs 30 per share) allotted to 13.5% convertible bondholders. 77,69,096

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ARUNA MANHARLAL SHAH INSTITUTE MANAGEMENT & RESEARCH

Fundamental & technical analysis of Chemical & Consumer Durables

bonus equity shares then issued in prop. 2:5.

1986
- Rehabilitation and upgradation of this unit was in progress. It continued to cater to the needs of expansion, modernisation and replacement programmes of the chemical complex at Mithapur. - The Company cancelled 59,970-7.14% cumulative (non-redeemable) preference shares and in lieu thereof allotted 15% secured redeemable non-convertible bonds of Rs 100 each at par. These bonds would be redeemable at par on 27.1.1999. - Pref. shares cancelled by issuing 15% bonds in lieu. 4,014 equity shares allotted against `B' & C' Parts of 13.5% convertible bonds (prem. Rs 30 per share) by receiving shares amount and prem. or through sale proceeds. - The name was changed to Sabras Investment and Trading Co. Ltd.

1987
- Effective from 31st March, the Company ceased to be a subsidiary consequent upon an issue on a private and preferential basis of the equity and cumulative convertible preference (ccp) shares of the face value of Rs 13.70 crores to the shareholders of the Company. - The Company issued 72,50,000-13.5% convertible debentures of the face value of Rs 100 each for cash at par aggregating of the face value of Rs 100 each for cash at par aggregating to Rs 72.50 crores. Of this, debenture worth Rs 67.97 crores were issued to the shareholders on rights basis in the proportion of 1 debenture for every 4 equity shares held, Rs 3.40 crores to the employees (including working directors) and Rs 1.13 crores to NRI's. Including the retention of oversubscription the following debentures were allotted; (i) 84,96,250 debentures to shareholders; (ii) 3,64,035 debentures to employees including Indian working directors and (iii) 1,41,250 debentures to NRI's. - An amount of Rs 40 out of the face value of each debenture of Rs 100 was automatically converted into 1 equity share of Rs 10 each at a premium of Rs 30 per share effective from 1st April. Accordingly 90,01,535 equity shares were issued to the holders of 13.5% debentures. The holders of the balance Rs 60 portion were given option to seek for allotment of 1 equity share at a premium of Rs 50 per share on payment of cash between 1st October 1987 to 31st March 1998. Also, from 1st October 1987 upto the date of redemption (end of the 7 year period), the Company reserved to itself the right to repurchase at its discretion, the non-convertible portion of Rs 60 of the face value of each debenture. By appropriating these sale proceeds of `B' portion of these convertible debenture or by receiving share amount and premium, the Company allotted 83,43,700 equity shares on 1st April 1988 and 3,58,381 equity shares on NILESH DINESH WAGH ARUNA MANHARLAL SHAH INSTITUTE MANAGEMENT & RESEARCH

Fundamental & technical analysis of Chemical & Consumer Durables

25th October, 1988. - On the 22nd May, a Memorandam of Understanding was signed between Indian Oil Corporation Ltd., the Government and the Company for promotion of a joint venture Company under the name and style of `Tata-Indian Oil Refineries Ltd.

1988
- The Steam power plant unit continued to perform fully well meeting the stream requirement of the chemical complex, except for the outage of one 13-MW turbo-generator causing power shortage for 4 months. - The Process Equipment unit was substantially upgraded and reorganized and received approvals under `IBR' and Lloyds. The Process Equipment unit undertakes sophisticated fabrication job and manufactures heavy, sophisticated process equipment. - As at 31st March, Tata Chemicals had accounted for Rs 52 crores in the CCP and Rs 8 crores in the equity shares of the Company. A Scheme of Amalgamation of Tata Fertilisers, Ltd. with the Company was approved by the Mumbai High Court on 7th September 1989. - The Research and Development unit is oriented towards process improvement, project development, waste utilisation and environmental control, supporting production activities.

1989
- The Process Equipment division undertook equipment design and preparatory work to take up substantial fabrication of the fertiliser plant being set up at Babrala. - The Company issued 15,00,000-14% non-convertible debentures of Rs 100 each on private placement basis to financial institutions. These are redeemable at a premium of 5% on 26th October, 1996. - The Company proposed to offer financial managerial and technical participation in the Rs 3,000 crore Haldia Petrochemicals Complex (HPL), a huge green-field project. West Bengal Industries Development Corporation and Tata Tea, Ltd. and its associates are the joint sector partners in the said complex. - 42,49,864 shares allotted without payment in cash to members of Tata Fertilisers, Ltd. on its merger.

1990
- The Company achieved self sufficiency in its requirements of Kurkutch salt-a basic raw material NILESH DINESH WAGH ARUNA MANHARLAL SHAH INSTITUTE MANAGEMENT & RESEARCH

Fundamental & technical analysis of Chemical & Consumer Durables

required for the production of a wide range of products. During the year, the Company proposed to introduce low-priced, high quality iodised Kurkutch salt. - At the end of March, a new BHEL low-pressure turbo-generator was commissioned. The low-pressure turbo generator and the topper turbine suffered major prolonged outages. - The Company signed the contract for supply of natural gas to the fertiliser project at Babrala with the Gas Authority of India, Ltd. The implementation of the project remained slow due to non receipt of "Deemed Export Status" despite several appeals made to the Finance Ministry and the long delay experienced in the receipt of bulk import licence. - DGTD registration was received for the manufacture of 1,50,000 TPA of unadulterated environmentally safe detergent materials. - The Company undertaken to set up a cement plant at the existing chemical complex at Mithapur having a capacity of about 2,50,000 TPA of ordinary portland cement or 4,40,000 TPA of Pozzolana Portland cement. Budgetary offers for a wholly indigenous plant having a 900 TPD capacity was received and an application was made for an industrial licence. - The Company offered 125,00,000 - 12.5% partly convertible debentures (PCDs) of Rs 150 each on Rights basis in the proportion 1 PCD: 6 equity shares held (all were taken up). Additional 18,75,000 debentures were allotted to retain oversubcription. Another 6,25,000-12.5% PCDs were issued to employees of the Company (including Indian working Directors)/workers on an equitable basis. (All were taken up). - Rs. 50 (Part `A') of the face value of each debenture was to be automatically and compulsorily converted into one equity share of Rs 10 each at a premium of Rs 40 per share on 1st August 1992. Accordingly 150,00,000 equity shares were allotted. - Rs. 50 (Part `B') of the face value of each debenture was to be automatically and compulsorily converted into one equity share of Rs 10 each. Accordingly 150,00,000 equity shares were allotted for cash at par during 1992-93. The remaining Rs. 50 of the face value of each debenture was to be redeemed at the end of 10 years from the date of allotment of the debentures with an option to the Company to redeem the same in whole or in parts at any time after 7 years from the date of allotment along with the residual portion, if any, of part `B' above. - The Company also offered 123,00,000 - 14% non-convertible debentures (NCD) of Rs 100 each on Rights basis in the proportion 1 NCD:6 equity shares held (all were taken up). These debentures were to be redeemed on expiry of 7 years from the date of allotment of debentures at a premium of 5% of 10th January, 1998. NILESH DINESH WAGH ARUNA MANHARLAL SHAH INSTITUTE MANAGEMENT & RESEARCH

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- The Company issued 46,00,000 - 12.5% Partly Convertible Debentures (PCDs) of Rs 175 each of which the following debentures were reserved for allotment on a preferential basis: (i) 22,00,000 PCDs to shareholders of the Company (all were taken up) and (ii) 2,30,000 PCDs to employees (including working directors)/workers on an equitable basis (only 275 debentures taken up). The balance 21,70,000 PCDs, along with 2,29,725 PCDs not taken up by employees, were offered for public subscription (all were taken up). - Rs 50 (Part `A') of the face value of each debenture was to be automatically and compulsorily converted into 1 equity share of Rs. 10 each at a premium of Rs 40 per share. Accordingly 46,00,000 equity shares were allotted on 1st August 1992. - Rs 50 (Part `B') of the face value of each debenture was to be automatically and compulsorily converted into 1 equity share of Rs 10 each at the end of 30 months from the date of allotment of debentures. Accordingly 46,00,000 equity shares were allotted during 1992-93. - Rs 75 of the face value of each debenture was to be redeemed at par at the end of the 10 years from the date of allotment of debentures with an option to the Company to redeem the same in whole or in parts at any time after 7 years from the date of allotment, along with residual portion, if any, of part `B' above. - 245,84,279 bonus shares allotted on 1.10.1990 in prop. 1:2.

1991
- A major replacement job was undertaken at CEHP boiler No. 1 which was completed in a record time of 15 days. - During 1991-92, it was proposed to give consent to the termination of MOU and leave IOC had expressed the desire to do so despite the withdrawal of the Soviets and substantial cost escalations. - The last quarter of 1991, hurdles such as grant of deemed export house status for the indigenous manufactures, allocation of foreign exchange etc., were resolved.

1992
- During the year, a modern circo-fluid high pressure boiler having a capacity of 200 TPH steam and a 16 MWT lopping turbo generator set together form a co-generation systems were being installed. The Company commission the circo-fluid boiler and 16 MW topping turbo generator by 1994.

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- The Company proposed to add a new circulating fluidised bed boilder and topper turbine to the stream power plant for generation of additional steam and power.

1993
- Rs 320 crores Mithapur Vikas Plan project made headway with the construction of new boiler and turbine. Equipments were being added in a phased manner to the soda ash plant and production capacity is started to increase from 7 lakh TPA to 10 lakh TPA over the next 33 years.

1994
- The fertiliser project at Babrala commissioned in December. - The Company entered into a sales agreement with Rallis India Ltd. for distribution and sales of urea from Babrala to Punjab, Haryana, U.P. and Rajasthan.

1995
- A new Circo Fluid boiler and a new 16.5 MW turbo generator set was commissioned. However, the steam-power position remained below expectation due to the teething problems in the initial stages and a fire which damaged the turbine's casing. - The testing of the new boiler and turbine were started during March, and the co-generation of power plant was commissioned in May. Equipments were added to the soda ash plant to increase production capacity to one million tonnes per year. - In order to meet increasing demand of Urea, the company proposed to double the production capacity of Fertiliser complex at Babrala. - 67,771,703 bonus equity shares allotted in prop. 3:5.

1996
- The gradual increase in soda ash capacity to one million tonnes per year was continuing. The installation of a new Dense ash plant and the expansion of the Sodium Bicarbonate was expected to be commissioned by September 1997.

1997

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- Tata salt recorded a market share of 32% in the branded, iodized salt market maintaining a Company leadership position. - 40 Tata Kisan Kendras were being set up to provide a complete package of agricultural inputs and impart knowledge and training of improved farm practices to farmers. - Tata Chemicals Ltd (TCL) has shelved its expansion project of setting up another urea plant with a capacity of 7.26 lakh tonnes per annum adjacent to its existing unit. - Tata Chemicals may buy-out the loss-making new fertiliser plant of Sanderson Industries Ltd in Jamshedpur, which sources coke-oven waste from Tisco as its base raw material.

1998
- Tata Chemicals has decided to double its cement capacity to 8,00,000 per annum from 4,00,000 tpa at an investment of Rs.300 crore, to increase capacity of soda ash from 7.5 lakh tpa to 8.5 lakh tpa at a cost of Rs.40 crore and to foray into importing and marketing of Liquified Natural Gas (LNG) along with a consortium of Indian fertiliser companies. - The company is diversifying into power generation by generating wind energy at its 37,000 acre site at Mithapur in Gujarat. - The company has proposed amendments in its articles of association for share buyback, issuing of shares without voting rights, dematerialisation of securities and introduction of employee's stock option scheme. - 86,320 shares forfeited.

1999
- The company's very recent launch is `Rakshak' detergent powder which is currently available at an introductory price of Rs 19 per kg as against the maximum retail price of Rs 22. The launch of Rakshak follows the quiet entry of `Shudh' detergent powder, which was launched a year ago, and is currently priced at Rs 36 for the same volume.

2000
- The board of directors has approved a proposal to merge with the company's wholly-owned subsidiary, Sabras Investments and Trading Co. Ltd.

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- Prasad R. Menon has been appointed as a new Managing Director of the company. - Tata Chemicals Ltd. will be merging investment subsidiary Sabras Investment & Trading Co. Ltd. with itself. - Tata Chemicals president R K Kaul has decided to step down from the helm of the company, effective 15th October. - Fertiliser major Tata Chemicals has decided to exit its detergents business, which has a single brand Shudh, and is in talks with potential buyers to sell it.

2001
- Tata Chemicals Ltd is in talks with Gujarat Ambuja Cement for selling off its cement unit at Mithapur, Gujarat. - A major fire broke out at the Tata Chemicals Ltd. plant at Mithapur gutting a portion of the inorganic chemical plant. The Plant resumed production on March 24.

2002
- Tata Chemicals Ltd has informed BSE that Mr.Sunil Wadhwa has been re-designated as Chief Financial Officer and Company Secretary of the company. -Tata Chemicals Ltd has informed BSE that Mr P K Ghose has been appointed as Chief Financial Officer of the company with effect from November 1, 2002. -Tata Chemicals Ltd has informed that the Board has taken a note of the resignation of Mr Arvind N Lalbhai from the Directorship of the Company.

2003
-Tata Chemicals and HLL have cleared an exchange ratio at 2.5:1 for amalgamation. -Tata Chemicals wins a decade long Rs.400cr tax dispute, with the Supreme court rejecting the demand of the income-tax department. -Tata chem has informed that ICRA has assigned LAA+ rating to the company's proposed Rs.1250million Non-Convertible Debenture Programme.

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-Tata Chemicals has availed of $20 million ECB at an interest rate 100 basis points above the London Inter Bank Offer Rate(LIBOR) for three years.

2004
-Tata Chemicals picks up gas from Petronet LNG -Tata Chemicals Ltd has appointed Mr Homi Khusrokhan as an Executive Director of the company - The merger of Hind Lever Chemicals Ltd with Tata Chemicals Ltd came into effect on June 1. Consequent to the orders of the High Court of Judicature, Mumbai, and the High Court of Punjab & Haryana, sanctioning the Scheme of Amalgamation of Hind Lever Chemicals with Tata Chemicals, Hind Lever Chemicals has merged with Tata Chemicals, effective from June 1, 2004.

2005
-Tata Chemicals launches 'Tata Kisan Sansar' in West Bengal and Jharkhand -Tata Chemicals launches a US $ 150 million Convertible Bond Issue -Tata Chemicals enter into 2 separate agreements for acquiring majority stake in U.K. based chemical company -Tata Chemical's Mithapur unit, Bharat Heavy Electricals's Ranipet works and I-flex Solutions have won the IMC Ramakrishna Bajaj national quality award trophy 2004. -First step towards internationalisation. TCL acquires an equal partnership in Indo Maroc Phosphore SA (IMACID) along with Chambal Fertilisers and global phosphate major, OCP of Morocco.

2006
-Tata Chemicals picks up ICMA excellence award -Tata Chemicals Ltd on October 13, 2006 has announced the appointment of Mr. Homi Khusrokhan as Managing Director with effect from October 16, 2006. - Tata Chemicals Ltd. has informed that Mr. Prasad R. Menon has been appointed as an additional director on the Board of the Company, with effect from October 30, 2006. Mr. Prasad R. -Tata Chemicals Ltd has appointed Mr. Prasad R Menon as an Additional Director on the Board of the Company,

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Fundamental & technical analysis of Chemical & Consumer Durables

-TCL completes acquisition of UK-based Brunner Mond Group, one of the world's leading manufacturers soda ash and associated alkaline products

2007
-Tata Chemicals Ltd has informed that the Company and Total Produce Plc (TOTAL PRODUCE) on February 01, 2007 has entered into an agreement to form a 50/50 joint venture Company in India. -Khet Se Agriproduce set up as a 50:50 joint venture with Total Produce, Ireland, the third largest fruits and vegetable distribution company in the world. -TCL wins Deal of the Year Award for BMGL acquisition IMA -Tata Salt wins Popular Consumer Award and title Master Brand Bharti Vidyapeeths Institute of Management Studies & Research

2008
-Tata Chemicals Ltd has informed that Dr. M S Ananth, Director, Indian Institute of Technology Madras, has been appointed as an Additional Director on the Board of the Company with effect from April 03, 2008. -Tata Chemicals Ltd has informed that Mr. Arun Maira, an international Management Consultant, has been appointed as an Additional Director on the Board of the Company with effect from September 25, 2008. -TCL acquires US-based General Chemical Industrial Products (GCIP). Becomes worlds second largest soda ash manufacturer. -Tata Chemicals opens Call Centre in UP

2009 -Tata Chemicals Limited, UREA division achieves RC 14001 - 2005 CertifIcation. -TCL has been
certified under SA 8000:2001 standard for the Mithapur, Babrala and Haldia sites by RINA India Pvt Ltd. TCL Awarded the Business Superbrands Status -The Asset Triple A Best Deal India Award

2010 - Tata Chemicals Ltd has appointed Dr. Y. S. P. Thorat as an Additional Director on the Board of
the Company with effect from January 08, 2010.

2011
- Tata Chemicals - Acquisition of 100% stake in British Salt Limited, UK - Tata Chemicals "Investment in Greenfield Port-based Ammonia-Urea Fertilizer Manufacturing Complex in Gabon, Africa" NILESH DINESH WAGH ARUNA MANHARLAL SHAH INSTITUTE MANAGEMENT & RESEARCH

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- Tata Chemicals signs technical services agreement with Notore Chemicals Industries of Nigeria, for providing technical advisory services - Tata Chemicals acquires stake in EPM Mining Ventures - Tata Chemicals - Signing of the Pre Construction Services Agreement with Technip for the Gabon Fertiliser Project

2012
- Tata Chemicals Ltd appointed Mr. Cyrus P. Mistry as the Deputy Chairman of Tata Chemicals Ltd - Tata Chemicals Ltd won the prestigious Employer Branding Award 2012, for 'Best HR Strategy in Line with Business Strategy', instituted by the World HRD Congress.

EXECUTIVE SUMMARY
The summary page of Tata Chemicals Ltd. captures the information on its positioning, Historical Price Chart, Key Ratios, Competitors, Comparative Analysis, Buy Sell Recommendations, Company News and Announcements, cash flow, valuation, strategy, Shareholding Pattern and Annual P&L A/c items, and NILESH DINESH WAGH ARUNA MANHARLAL SHAH INSTITUTE MANAGEMENT & RESEARCH

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Community Prediction.

BOARD OF DIRECTORS

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INDUSTRY INFORMATION
Tata Chemicals Ltd is a global company with interests in businesses that focus on LIFE living, industrial and farming essentials. The company is the world's second-largest producer of soda ash. They have manufacturing facilities in India, UK, USA, the Netherlands and Kenya with global capacity of around 5.5 MTPA. They are also a leading player in the consumer products and crop nutrition and agribusiness segments. The company is based in Mumbai with plant locations in Mithapur (Gujarat), Babrala (UP), Nanded (Maharashtra) and Haldia (West Bengal) in India; Northwich, Cheshire (United Kingdom), East Hanover, New Jersey (United States), Delfzijl (The Netherlands) and Magadi (Kenya). They are having the largest single soda ash production capacity plant in India. They operate in three sectors,
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namely living essentials (household products), industry essentials and farm essentials (crop nutrition and protection). The company is India's leading Crop Nutrients Player with their own manufacturing of urea and phosphatic fertilisers and a leading player in crop protection business through their subsidiary company, Rallis India Ltd. Also, the company is the pioneer and India's market leader in the branded, iodised salt segment. The company is world's most geographically diversified company, with an efficient supply chain that can service customers across the globe. Tata Chemicals Ltd was incorporated on January 23, 1939. In the year 1942, the company completed the bromine plant, the first unit of the company's chemical works. In the year 1943, they commissioned the auxiliary power plant. Also, they commenced the production of caustic soda, liquid chlorine, bleaching powder, hydrochloric acid and zinc chloride. In February 1944, the company started the soda ash production. During the year, the company was given the rights to manufacture salt and marine minerals and to use limestone and other raw materials within the Kathiawad region. In the year 1949, they started the production of sodium bicarbonate. During the year 1952-53, they increased the Soda ash capacity from 50 to 100 tonnes per day. Also, they started production of technical grade benzene hexachloride (a pesticide) during the year 1955-56 starts so as to utilise surplus chlorine. In the year 1957, the company in association with Fison Pest Control formed a joint venture company name Tata Fisons. They introduced Ethylene dibromide, a new product from bromine. Also, they started production of an insecticide, namely copper oxychloride. During the year 1957-58, they launched a major expansion programme to increase capacity of products. In the year 1959, they completed the first phase of expansion. During the year 1961-62, they started production of dense soda ash. In the year 1964, the company completed their expansion programme and the soda ash capacity touched 400 tonnes per day. In the year 1971, they discontinued sale of chemicals through Tata Oil Mills (TOMCO) and starts selling on their own. In the year 1974, they set up Tata Energy Research Institute with an initial contribution of Rs 1 crore. During the year 1977-78, they started shipping division and also set up a wholly owned investment subsidiary, namely Roshan Investments Ltd. During the year 1979-80, the company established Tata Chemicals Society for Rural Development to improve quality of life in Okhamandal villages. In the year 1983, they launched Tata Salt, India's first iodised, vacuum evaporated and branded salt. In the year 1992, they launched Tata Shudh' detergent. In the year 1993, the company started a new cement plant at Mithapur. In the year 1994, they commissioned the fertilizer plant at Babrala. In the year 1996, the company received ISO 9001 certification. The production severely affected due to earthquake on January 2001 and the accidental fire in the power plant on March 2, 2001. During the year 2002, the company's Mithapur plant was awarded ISO-14001 certification and also the Chemicals Division at Mithapur was awarded the ISO-90012000 Migration certificate. In the year 2003, Tata Salt was ranked No. 1 Food brand in
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Brand Equity Survey of India's most trusted brands. The fertiliser plant got ISO-14001 and OHSAS-18001 certified. In the year 2004, the company set up the Innovation Centre to develop world-class R&D capability in the emerging areas of nanotechnology and biotechnology. In the year 2005, the company acquired equal partnership in Indo Maroc Phosphore SA (IMACID) along with Chambal Fertilisers and global phosphate major, OCP of Morocco. In the year 2006, the company completed the acquisition of UK-based Brunner Mond Group, one of the world's leading manufacturers of soda ash and associated alkaline products. In January 2007, the company set up 50:50 joint venture in association with Total Produce, Ireland, the third largest fruits and vegetable distribution company in the world, namely Khet Se Agriproduce Pvt Ltd. This JV was formed with the objective of bridging the gap between producer and end consumer in fresh produce business, which will significantly increase efficiencies, improve shelf-life and reduce product loss in the supply chain. During the year 2007-08, the company acquired General Chemical Industrial Products Inc, one of the large soda ash players in the US market, for a total consideration of USD 1005 million. As a part of the GCIP acquisition structure, they set up a 100% subsidiary in Mauritius, namely Wyoming 1 (Mauritius) Pvt Ltd. Also, they set up downstream subsidiaries, namely Wyoming 2 (Mauritius) Pvt Ltd, Gusuite Holding (UK) Ltd and Valley Holdings Inc. (US) were incorporated at Mauritius, UK and US respectively. They also set up a 100% subsidiary in Singapore, namely Tata Chemicals Asia Pacific Pvt Ltd. During the year, the company undertook field research on Jatropha, a non-edible tree crop for biodiesel production. They set up a research farm in Aurangabad and started varietal trials for developing a package of practice. Also, they set up multi location trials for Jatropha in Gujarat, Maharashtra, Tamilnadu and Andhra Pradesh. The company acquired land on the outskirts of Pune for constructing a state-of-the-art dedicated R&D centre, which will become its central knowledge hub. During the year 2008-09, the company through the wholly owned subsidiary Tata Chemicals Asia Pacific Pte Ltd entered into a joint venture agreement by investing SGD 15 million in JOil (Singapore) Pte Ltd, a Jatropha seeding company based in Singapore. The company holds 33.80% stake in JOil. In May 2008, the operations of Khet-Se began with the launch of its first state-of-the art procurement and distribution facility for fresh fruits and vegetables at Malerkotla, Punjab. During the year 2009-10, the company set up a bio-ethanol test plant of 30 KLPD at Nanded, Maharashtra as a part of their Biofuel Research and Development Programme using non conventional raw materials. They launched a nanotech water purifier which uses natural materials and cutting edge nanotechnology under the brand name 'Tata Swach'. The product was initially launched in Maharashtra and Karnataka. In November 2009, the company acquired 5,362,923 shares of Rallis India Ltd (Rallis). By virtue of such acquisition, the shareholding of the company in Rallis went up to 50.06% and thereby making Rallis as their subsidiary with effect from November 9, 2009. During the year, the company launched their Alkakarb, branded bicarbonate in the
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Indian market, aimed at animal feed application. As the domestic market matures and grows, the company will introduce all the other brands in their portfolio in India produced in their state-of-the-art plant in the UK. During the year, the company took steps to increase salt production at their Mithapur plant through de-bottlenecking to further boost the volumes available for sale. The company is setting up 1.32 Lakh MT capacity Customized Fertilizer plant at Babrala. In August 2010, the company signed a public-private partnership agreement with the Department of Science and Technology and Central Salt and Marine Chemicals Research Institute for setting up a 3 tonne per day sulphate of potash fertiliser plant in Gujarat as a joint research project. During the year 2010-11, the company launched their Sodakarb, branded bicarbonate in the Indian market, aimed at food applications. They done the pilot launch of I- Shakti pulses in the states of Tamil Nadu and Maharashtra. The pilot was aimed to integrate the strength of the company's presence in both farm and consumer facing ends of the business. As a part of their Biofuels Research and Development Programme using non conventional raw materials, the Company set-up a bio-ethanol test plant of 30 KLPD at Nanded, Maharashtra. The company now plans to set up a first generation bioethanol plant based on sugarcane only at Mozambique. Druing the year, the company acquired South Africa's Grown Energy which controls 95% stake in Grown Energy Zambeze to build biofuels capabilities in Mozambique. In December 30, 2010, Rallis India Ltd, a subsidiary of the company, acquired 60.21% stake in Metahelix Life Science Ltd, a research led seeds company. This acquisition will firm up the company's presence in the entire Seeds Value Chain that comprises breeding, production and marketing of seeds. In January 2011, the company, through their wholly owned overseas subsidiaries Tata Chemicals Europe Ltd, acquired 100% stake in British Salt held through Cheshire Salt Holdings Ltd. Also, they are rebranding global subsidiaries under Tata Chemicals corporate brand.

VISION
We shall be amongst premier chemical companies by: Leveraging science to deliver new and innovative offerings Enhancing value to our customers Delivering superior returns to our shareholders Leading in corporate sustainability Nurturing innovation, learning through diversity and team work amongst employees

MISSION
Serving society through science

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SERVING SOCIETY THROUGH SCIENCE


Tata Chemicals Limited is a global company with interests in businesses that focus on LIFE: Living, Industry and Farm Essentials. The story of the company is about harnessing the fruits of science for goals that go beyond business. This story began in Mithapur, Gujarat in western India with the creation of a plant that would raise a wealth of marine chemicals from the ocean, with the potential to touch human lives in many ways. From these humble beginnings a market-leading international business has been created, with operations across four continents. Through its living essentials portfolio the company has positively impacted the lives of millions of Indians. Tata Chemicals is the pioneer and market leader in Indias branded Iodised salt segment. With the introduction of an innovative, low-cost, nanotechnologybased water purifier, it is providing affordable, safe drinking water to the masses. Tata Chemicals is the worlds second largest producer of soda ash with manufacturing facilities in Asia, Europe, Africa and North America. The companys industry essentials product range provides key ingredients to some of the worlds largest manufacturers of glass, detergents and other industrial products. With its farm essentials portfolio the company has carved a niche in India as a crop nutrients provider. It is a leading manufacturer of urea and phosphatic fertilisers and, through its subsidiary, Rallis, has a strong position in the crop protection business. The Tata Chemicals Innovation Centre is home to world-class R&D capabilities in the emerging areas of nanotechnology and biotechnology. The companys Centre for AgriSolutions and Technology provides advice on farming solutions and crop nutrition practices. The company has also entered into a JV with Singapores Temasek Life Sciences Laboratory (Joil) to develop jatropha seedlings to enable bio fuels capability. In line with its mission, serving society through science, the company is applying its expertise in sciences, to develop high-tech and sustainable products.

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SCIENCE FOR SUSTAINABILITY


Tata Chemicals Mission, Vision and Values are deeply rooted in the principles of sustainability. For the company, sustainability encompasses stakeholder engagement, environmental stewardship, creating economic value, promoting human rights and building social capital. Tata Chemicals supports the UN Global Compact and is committed to reporting its sustainability performance in accordance with GRI guidelines. The company actively works towards improving its eco-footprint with a policy of avoid, reduce and reuse. Resource optimisation, alternative sources of fuel and raw materials, and maximising reuse and recycling are key drivers in operations. The company has been recognised for its clear commitments to sustainability and its good environmental management practices.

COMMUNITY LINKS
In 1980, Tata Chemicals set up a non-governmental organisation Tata Chemicals Society for Rural Development (TCSRD) that works towards holistic community development, including managing water, land and other natural resources, encouraging enterprise development, and promoting health and education. TCSRD's activities have been recognised at a national level. Tata Chemicals Europe (formerly Brunner Mond) is a major sponsor of the Lion Salt Works Trust, a local heritage project in Cheshire, UK and of the Weaver Valley Initiative, part of the path-breaking Mersey River clean up campaign. In Kenya, Tata Chemicals Magadi supports local health care facilities and works to provide education, water and employment opportunities. Tata Chemicals is also involved in efforts to preserve the biodiversity of land along the Gujarat coastline and the nesting sites of migratory birds. TCL and Wildlife Trust of India (WTI) have signed an MoU for a conservation project that will create awareness and undertake research to save the endangered species of whale shark that visits the coastal shores of Gujarat.

BUSINESSES
Headquartered in Mumbai, India, Tata Chemicals is a global company with a range of business interests focusing on three sectors living essentials, industry essentials and farm essentials or LIFE. The Tata Chemicals group is the worlds second-largest producer of soda ash with a presence in India, Kenya, the UK and the US. NILESH DINESH WAGH ARUNA MANHARLAL SHAH INSTITUTE MANAGEMENT & RESEARCH

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TATA CHEMICALS MAGADI


Tata Chemicals Magadi (TCM) occupies a significant place in the African economy. It is Africa's largest soda ash manufacturer and one of Kenya's leading exporters. Just as significant, the company is an important part of the socio-economic fabric of the Lake Magadi region in Kenya where its soda ash facility is based. Formerly known as Magadi Soda Company, TCM has been a part of Tata Chemicals since 2005. Tata Chemicals (TCL), a part of the global Tata group, is one of the world's leading chemical companies, with a widespread portfolio of household products, industrial chemicals and agricultural inputs. TCL's operations are located in the US, the UK, Kenya and India. Established in 1911, TCM has been producing soda ash at Lake Magadi for a hundred years. The site is situated 120kms south west of Nairobi. Here the company recovers trona (a naturally occurring mineral that contains sodium carbonate compounds) from one of the purest surface deposits in the base of the Rift Valley at Lake Magadi. TCM converts trona into soda ash, which is transported by rail to the Port of Mombasa for onward shipping to the markets.
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Soda ash is an essential constituent in the manufacture of glass and the production of detergents and industrial chemicals. Over 95 per cent of the company product is exported to its principal markets of South East Asia, Indian sub-continent, Africa and the Middle East. Sustainability is core to TCM's operations. The company is an equal opportunity employer and has over 450 people on its payroll. The role that TCM plays in the local community takes it far beyond the mantle of local employer. Over the decades, TCM has built deep connections with the local community through a number of health, education and employment initiatives.

TATA CHEMICAL EUROPE


PROFILE

Tata Chemicals Europe is one of Europe's leading producers of sodium carbonate, salt and sodium bicarbonate and other products. The high-quality soda ash produced by TCEL is used in the manufacture of glass, detergents and chemicals and in several other industry applications. The company also manufactures high quality sodium bicarbonate for use in haemodialysis treatment and in the pharmaceutical and baking industries. In addition it produces Alkakarb for the animal feed industry and Briskarb which is used for the treatment of acidic flue gases. Established in 1874, the former Brunner Mond company was acquired by Tata Chemicals (TCL) in 2005. TCL is part of the global Tata group, one of the world's leading chemicals companies, with a widespread portfolio of household, industrial chemicals and agricultural products. TCL has operations in North America, Europe, Africa and Asia.
A. OPERATIONS: TCEL is headquartered in Northwich, UK, and has manufacturing operations within Cheshire where it produces soda ash, salt, sodium bicarbonate, calcium chloride and Crex.

TCEL expanded its product portfolio in 2011 by acquiring British Salt which is the UK's leading manufacturer of pure dried vacuum salt products. The company's activities integrate the principles of corporate sustainability. All the products manufactured and supplied by the company comply with the ISO 9001:2008
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Fundamental & technical analysis of Chemical & Consumer Durables

quality registration standards.

B. The health, safety and well being of employees is in the forefront of TCEL's business activity. The company is a major sponsor of the Lion Salt Works Trust, a local heritage project and of the Weaver Valley Initiative, part of the Mersey Basin Campaign C. WELCOME TO BRITISH SALT

Salt it touches all our lives. From food production and water treatment to animal feeds and keeping the roads safe in winter, in one way or another salt is a vital daily commodity. British Salt is the UK's leading manufacturer of pure dried vacuum salt products. With a reputation for quality of products, service and reliability of supply British Salt plays a crucial role in keeping British industry moving. On this website you will find everything you need to know about British Salt, from products to people, contact details to ordering information. A single point of information from the UK's primary supplier.

TATA CHEMICALS NORTH AMERICA INC.


Tata Chemicals North America Inc., hereinafter referred to as Tata Chemicals North America (TCNA), is one of the world's leading producers of high-quality soda ash. TCNA and its predecessor companies have been producing soda ash (also known as sodium carbonate) since 1884. Soda ash is a raw material used by several industries to make a range of essential products, such as glass, baking soda, laundry detergent, paper, textiles, potable water and clean air. Formerly known as General Chemical Industrial Products Inc., TCNA became a part of Tata Chemicals Ltd. (TCL) in 2008. TCL, a part of the global Tata Group, is one of the world's leading chemicals companies, with a widespread portfolio of household products, industrial chemicals and agricultural additives. TCL has its soda ash operations in the US, UK, Kenya and India. Headquartered in New Jersey, TCNA's manufacturing operations are based in Green River,
NILESH DINESH WAGH ARUNA MANHARLAL SHAH INSTITUTE MANAGEMENT & RESEARCH

Fundamental & technical analysis of Chemical & Consumer Durables

Wyoming, USA. TCNA's Green River facility is one of the largest soda ash facilities in North America, with an underground trona mine that spans 55 square miles. Trona is a naturally occurring mineral ore that contains sodium carbonate compounds. TCNA mines more than 4.5 million tons per year of trona ore that it processes into soda ash at its surface refining plant. The estimated recoverable trona ore reserves consist of approximately 600 million tons, enough to provide approximately 100 years of reserves based on current operating rates. The Green River facility is jointly owned by TCNA (the managing partner with a 75 percent stake) and Owens-Illinois Inc. (25 percent stake), a world leader in glass container manufacture.

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Fundamental & technical analysis of Chemical & Consumer Durables

FARM CENTRES
The Tata Kisan Sansar (TKS) is a network of nearly 600 farmer resource centres that caters to more than 3.5 million farmers in 22000 villages in the northern and eastern part of India. The centres are one-stop solution shops that provide farmers access to a wide range of agricultural inputs such as vital fertilizers, seeds, and pesticides along with agricultural services such as soil testing, crop advisory and foliar application services. New services being explored include financial services and IT enabled market information. Tata Kisan Sansar (TKS) TKS philosophy TKS Parivar

TATA KISAN SANSAR: ENABLING, EMPOWERING


Kisan: farmer; Sansar: world; Parivar: family

EMPOWERMENT
The objective of the Tata Kisan Sansar (TKS) network is to enable and empower the farmer in creating and generating more value for farm produce by providing information on new and improved agronomic practices and by facilitating better and more efficient use of agricultural inputs. The philosophy behind TKS is to become a change agent for the Indian farming community.

STRUCTURE
TKS functions as a hub and spoke model. Each TKS centre is a franchised retail outlet and solution provider that caters to about 30-40 villages in the surrounding area. The centres are in turn serviced by about 30-odd resource centres (known as Tata Krishi Vikas Kendras or TKVK), with each resource centre looking after 17-18 TKS centres.

BENEFITS
TKS provides the following Access to expert advice: There are more than 60 agronomists available at the hubs to provide advice on crops and farming issues. There are more than 150 organisers at the TKS level.

INPUTS: TKS CENTRES PROVIDE GENERIC AS WELL AS STORE BRANDS OF


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Fundamental & technical analysis of Chemical & Consumer Durables

Fertilisers: Specialty fertilisers:

Urea, DAP, MOP, NPK, etc Zinc sulphate, boron, micronutrients, calcium nitrate, organics, water soluble fertilisers Field crops, vegetable crops Entire range

Seeds: Pesticides: Cattlefeed Farm implements

Training: In nutrient and pest management

SERVICES
Soil and water testing Contract farming Seed production Application services Advisory services

RELATIONSHIP BUILDING:
Farmer membership (individual & group) Accident insurance to members Farmer meets Crop seminars

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ARUNA MANHARLAL SHAH INSTITUTE MANAGEMENT & RESEARCH

Fundamental & technical analysis of Chemical & Consumer Durables

TATA KISAN SANSAR PHILOSOPHY: WEALTH FOR THE FARMERS


Tata Chemicals' objective in setting up the TKS network is to empower the Indian farmer and support the farming community in creating more value for their produce. In India, the agriculture sector constitutes one-fourth of the Indian economy, yet it employs more than two-thirds of the total working population. The healthy performance of the agriculture sector is vital for the well-being of the entire nation. Though India is a leading producer of many crops, the value addition from agriculture is decreasing. This is partly due to greater income streams from industry and services the one-third of the population in the non-agricultural sector earns three-fourths of the national income. Increased urbanisation has led to further pressures less land under cultivation, increased demand for food, a widening gap between urban and rural incomes, and lack of alternative employment opportunities for farm workers. The continuous widening of the gap in per capita income between the agricultural and non-agricultural sectors has huge economic and social implications, especially when the non-farm sector is incapable of employing the poor from the farm sector. As Tata Chemicals sees it, the imperative for all stakeholders engaged in agri-business is to empower the farmers by enhancing their capability and their sources of income. The concept and vision of TKS has evolved over the years and is based on identifying critical needs of the farmer. The three most critical needs are access to markets/retail spaces, credit facilities and information/advice. TKS has been pivotal in providing value-added service to farmers, which has helped improve their quality of living. The network offers multiple benefits that address a wide range of needs that the farmers experience in their constant struggle towards prosperity and progress

TATA KISAN SANSAR PARIVAR: BUILDING STRONG RELATIONSHIPS


A very important aspect of TKS is building relationships with the farmers. This initiative is being advanced through several means. The Tata Kisan Sansar Parivar membership is a paid value-added service, where key farmers and opinion leaders are enrolled for the membership through invitation. Tata Kisan Sansar Parivar members are provided customised training and accident insurance for the member and his family. The Tata Kisan Sansar Parivar membership currently stands at about 40,000 plus.

INNOVATION CENTRES
TCL INNOVATION CENTRE | CENTRE FOR AGRICULTURE AND TECHONOLOGY (CAT)
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Fundamental & technical analysis of Chemical & Consumer Durables

Tata Chemicals believes that it can leverage its expertise in chemicals and agri-businesses to offer innovative products and services that could change peoples lives for the better. And it has made it its mission to serve society through science. Although TCL started its life as a chemicals company, it has been able to successfully integrate itself with the other sciences. The company has identified what it terms the FEW areas of focus food and fuel, energy and environment and water and wellness. It is working on innovative products and services in each of these areas. At the TCL Innovation Centre in Pune, set up in 2004, the focus is on FEW and exploring how these sectors can be best served. The centre is working on products and services that are positioned at the intersection between physics and chemistry (nanotechnology) and biology and chemistry (biotechnology) to come with innovative solutions to old problems. In the area of water and wellness, for instance, one of the best known outcomes of the research being undertaken is Tata Swach, a low-cost water purifier. The TCL Innovation Centre is also working to build a significant presence in the biofuels sector. It is researching technologies that can mitigate climate change through "green chemistry" and product offerings that will make a difference like flue gas treatment, carbon absorption and nano glass-coatings for insulation. The centre is also looking at nutraceuticals as part of its wellness initiatives.

TCL INNOVATION CENTRE


Tata Chemicals Innovation Centre was set up with the objective of developing world-class R&D facility working on more than 20 projects in the areas of nanotechnology and biotechnology. It has now moved from being TCL-centric to a having a much wider base of clients, from the Tata group as well as external companies.

THE TEAM OF SCIENTISTS AT THE CENTRE IS WORKING IN THE FOLLOWING AREAS:


Advanced materials Specialty chemicals Green chemistry and catalysis Nutraceuticals

CENTRE FOR AGRICULTURE AND TECHONOLOGY (CAT)


The CAT has been set up in Aligarh, Uttar Pradesh to provide advice to farmers on farming and crop nutrition practices and solutions. This centre is staffed with experienced scientists who are working in various areas of agri-technology. Specific projects have been undertaken on determining area and crop specific nutrition products and combinations, soil health tracking through indexing etc. NILESH DINESH WAGH ARUNA MANHARLAL SHAH INSTITUTE MANAGEMENT & RESEARCH

Fundamental & technical analysis of Chemical & Consumer Durables

The CAT is expected to provide TCL a competitive advantage in the future and will provide a very strong base for the growth of the company in its customised fertiliser business, specialty crop nutrients business and agribusiness. At its agricultural technology centre in Aligarh, TCL has been engaged in development of Paras Farmoola customised fertilisers. These fertilisers are designed for specific crop and soil requirements and hence yield better results.

BALANCESHEET - TATA CHEMICALS LTD.


Particulars Liabilities Share Capital Reserves & Surplus Net Worth Secured Loans Unsecured Loans TOTAL LIABILITIES Mar'12 12 Months 254.82 4,762.41 5,017.23 498.93 1,960.50 7,476.66 Mar'11 12 Months 254.82 4,485.86 4,740.68 252.73 2,723.21 7,716.62 Mar'10 12 Months 243.32 4,031.75 4,275.07 249.24 2,697.27 7,221.58 Mar'09 12 Months 235.23 3,386.68 3,621.91 249.48 3,426.62 7,298.01 Mar'08 12 Months 234.06 3,337.62 3,571.68 47.97 2,297.31 5,916.96 Assets Gross Block (-) Acc. Depreciation Net Block Capital Work in Progress. Investments. Inventories Sundry Debtors Cash And Bank Loans And Advances Total Current Assets 4,300.35 2,490.32 1,810.03 265.38 4,613.87 1,253.22 1,485.83 891.85 554.41 4,185.31 3,946.56 2,358.98 1,587.58 340.05 4,901.69 696.30 731.72 798.76 545.28 2,772.06 3,803.50 2,211.06 1,592.44 237.65 4,905.59 611.19 581.60 712.65 391.39 2,296.83 3,602.99 2,058.01 1,544.98 298.77 4,473.73 969.80 1,001.73 638.75 863.35 3,473.63 3,291.44 1,948.24 1,343.20 169.38 3,741.40 657.64 639.50 277.63 713.45 2,288.22

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Fundamental & technical analysis of Chemical & Consumer Durables

Current Liabilities Provisions Total Current Liabilities NET CURRENT ASSETS Misc. Expenses TOTAL ASSETS (A+B+C+D+E)

2,980.84 417.09 3,397.93 787.38 0.00 7,476.66

1,483.60 401.16 1,884.76 887.30 0.00 7,716.62

1,457.74 353.19 1,810.93 485.90 0.00 7,221.58

2,120.39 372.71 2,493.10 980.53 0.00 7,298.01

1,273.98 351.79 1,625.77 662.45 0.53 5,916.96

PROFIT & LOSS - TATA CHEMICALS LTD.


Mar'12 12 Months Mar'11 12 Months Mar'10 12 Months Mar'09 12 Months Mar'08 12 Months INCOME: Sales Turnover Excise Duty NET SALES Other Income TOTAL INCOME 8,146.21 158.93 7,987.28 0.00 8,267.61 6,354.07 129.47 6,224.60 0.00 6,365.22 5,512.54 100.84 5,411.70 0.00 5,548.63 8,537.21 173.86 8,363.35 0.00 8,496.49 4,207.13 170.45 4,036.68 0.00 4,167.22

EXPENDITURE: Manufacturing Expenses Material Consumed Personal Expenses Selling Expenses Administrative Expenses Expenses Capitalised Provisions Made TOTAL EXPENDITURE Operating Profit NILESH DINESH WAGH 737.66 4,909.97 239.75 0.00 1,047.91 0.00 0.00 6,935.29 1,051.99 612.29 3,737.42 207.38 614.25 234.46 -10.22 0.00 5,395.58 829.02 463.52 3,168.81 204.66 514.56 187.37 0.00 0.00 4,538.92 872.78 655.99 5,652.40 195.81 457.51 398.89 -2.26 0.00 7,358.34 1,005.01 530.33 2,105.80 169.73 372.21 171.69 -0.1 0.00 3,349.62 687.06

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Fundamental & technical analysis of Chemical & Consumer Durables

EBITDA Depreciation Other Write-offs EBIT Interest EBT Taxes Profit and Loss for the Year Non Recurring Items Other Non Cash Adjustments Other Adjustments REPORTED PAT

1,332.32 224.68 0.00 1,107.64 210.19 897.45 177.75 719.70 -133.10 0.00 0.00 586.60

969.64 204.46 0.00 765.18 201.49 563.69 150.21 413.48 -22.93 17.94 0.00 408.49

1,009.71 187.19 0.00 822.52 205.73 616.79 153.35 463.44 -48.58 19.92 0.00 434.78

1,138.15 163.03 0.00 975.12 191.89 783.23 208.22 575.01 -175.60 20.80 31.84 452.05

817.60 148.76 0.00 668.84 41.04 627.80 207.92 419.88 511.06 18.24 0.00 949.18 KEY ITEMS

Preference Dividend Equity Dividend Equity Dividend (%) Shares in Issue (Lakhs) EPS - Annualised (Rs)

0.00 254.76 99.97 2,547.56 23.03

0.00 254.76 99.97 2,547.56 16.03

0.00 218.93 89.97 2,432.56 17.87

0.00 211.65 89.97 2,351.69 19.22

0.00 211.25 90.27 2,339.94 40.56

CASH FLOW
Particulars Profit Before Tax Net Cash Flows from Operating Activity Net Cash Used in Investing Activity Net Cash Used in Financing Activity Net Inc/Dec in Cash and Cash Equivalent Mar'12 764.35 340.73 89.29 -336.93 93.09 Mar'11 558.70 427.78 -248.19 -93.48 86.11 Mar'10 588.13 843.07 -48.35 -706.42 88.30 Mar'09 660.27 575.77 -729.18 487.91 334.50 Mar'08 1,157.10 478.81 -1,796.98 1,499.29 181.12

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ARUNA MANHARLAL SHAH INSTITUTE MANAGEMENT & RESEARCH

Fundamental & technical analysis of Chemical & Consumer Durables

Cash and Cash Equivalent - Beginning of the Year Cash and Equivalent - End of the Year

798.76 891.85

712.65 798.76

624.35 712.65

304.25 638.75

96.51 277.63

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Fundamental & technical analysis of Chemical & Consumer Durables

RATIO ANALYSIS

RATIO ANALYSIS
Company Name
Income Statement Revenue Cost of Goods Sold Interest Expense Tax Expense Income from Cont Operations PBIT Depreciation Purchase Gross profit Net Income Balance Sheet Cash Short Term Investments Accounts Receivable Trade payable Inventory Current Assets Long Term Investments Net Fixed Assets Other Assets Current Year $ 8,268 7,370 190 210 7,987 1,199.22 225 2,168 2,955 587 Percent 100.0% 89.1% 2.3% 2.5% 96.6% 14.5% Prior Year $ 6,441 5,845 188 189 6,333 956.79 204 1,309 2,825 408 Percent 100.0% 90.8% 2.9% 2.9% 98.3% 3 Years Ago $ 5,669 4 Years Ago $ 8,526 5 Years Ago $ 4,677

7.1%

6.3%

892 0 1,486 769 1,253 349 4,614 2,075 205

8.2% 0.0% 13.7% 11.5% 3.2% 42.4% 19.1% 1.9%

799 0 724 65 696 281 4,901 1,887 206

8.4% 0.0% 7.6% 7.3% 3.0% 51.6% 19.9% 2.2%

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Fundamental & technical analysis of Chemical & Consumer Durables

Total Assets Current Liabilities Total Liabilities Debt(long & short borrow) Stockholders' Equity Cash Flow Cash Flow from Operations Dividends Paid Interest Paid Per Share No. of shares Market Price at Year End Book Value Earnings Per Share - Basic

10,875 3,416 10,875 2,459 5,017

100.0% 31.4% 100.0% 22.6% 46.1%

9,496 1,892 9,496 2,709 4,741

100.0% 19.9% 100.0% 28.5% 49.9%

341 292

424 254

25.47 345.55 196.94 23.03

25.47 341.00 186.09 16.32

RATIO ANALYSIS Growth Ratios Sales Growth Income Growth Asset Growth Activity Ratios Receivable Turnover Inventory Turnover Fixed Asset Turnover Profit Ratios Profit Margin Return on Assets Return on Equity Dividend Payout Ratio Price Earnings Ratio Liquidity Ratios Current Ratio Quick Ratio Solvency Ratios Debt to Total Assets Times Interest Earned (Accrual) Times Interest Earned (Cash)

28.4% 26.1% 14.5% 7.5 7.6 4.0 96.6% 78.4% 163.7% 49.8% 15.0 0.10 0.70 1.00 44.16 #DIV/0!

13.6% #DIV/0! #DIV/0! 17.8 16.8 3.4 98.3% 133.4% 267.2% 62.1% 20.9 0.15 0.81 1.00 35.69 #DIV/0!

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Fundamental & technical analysis of Chemical & Consumer Durables

Shareholder equity ratio Debt service coverage ratio Interest coverage ratio Debtors collection period Payable turnover Creditor's payment period Gross profit margin Market price to book value Dividend per share Dividend yield ratio Debt to Equity

4.00

6.808387 5.089309 20.52785 40.56151 8.998678 0.438615 11.40257 9.966627 0.391308 0.571477

6.3146754 48.790591 5.200072 70.191336 0.3573633 8.5514546 11.474676 0.4505173 0.4901968

REVENUE TREND
REVENUE TREND

$10,000 $8,000 $6,000 $4,000 $2,000 $0 5 Years Ago4 Years Ago3 Years Ago Prior Year Current Year

CASH FLOW
INCOME TO CASH FLOW COMPARISON
$9,000 $8,000 $7,000 $6,000 $5,000 $4,000 $3,000 $2,000 $1,000 $0 3 Years Ago Prior Year Current Year
Income Continuing Operations

Cash Flow from Operations

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Fundamental & technical analysis of Chemical & Consumer Durables

CHANGES IN ASSETS
ASSET CHANGES
$12,000 $10,000 $8,000 $6,000 $4,000 $2,000 $0 3 Years Ago Prior Year Current Year
Total Assets

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ARUNA MANHARLAL SHAH INSTITUTE MANAGEMENT & RESEARCH

Fundamental & technical analysis of Chemical & Consumer Durables

NILESH DINESH WAGH

ARUNA MANHARLAL SHAH INSTITUTE MANAGEMENT & RESEARCH

Fundamental & technical analysis of Chemical & Consumer Durables

NILESH DINESH WAGH

ARUNA MANHARLAL SHAH INSTITUTE MANAGEMENT & RESEARCH

Fundamental & technical analysis of Chemical & Consumer Durables

TECHNICAL ANALYSIS

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Fundamental & technical analysis of Chemical & Consumer Durables

ONE YEAR TECH LINE CHART OF TATA CHEMICALS LTD.

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Fundamental & technical analysis of Chemical & Consumer Durables

CANDLESTICK CHARTS & RECENT PATTERNS OF TATA CHEMICALS LTD

Reasons to Buy

Get detailed information on the company's financial deals that enable you to understand the company's expansion/divestiture and fund requirementsThe profile enables you to analyze the company's financial deals by region, by year, by business segments and by type, for a five year period. Understand the company's business segments' expansion / divestiture strategyThe profile presents deals from the company's core business segments' perspective to help you understand its corporate strategy. Access elaborate information on the company's recent financial deals that enable you to understand the key deals which have shaped the companyDetailed information on major recent deals includes a summary of each deal, deal type, deal rationale, deal financials and Target Company's key financial metrics and ratios. Equip yourself with detailed information about the companys operations to identify potential customers and suppliers.The profile analyzes the company's business structure, locations and subsidiaries, key executives and key competitors. Stay up-to-date on the major developments affecting the companyRecent developments concerning the company presented in the profile help you track important events.

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Gain key insights into the company for academic or business researchKey elements such as break up of deals into categories and information on detailed major deals are incorporated into the profile to assist your academic or business research needs. Note: Some sections may be missing if data is unavailable for the company.

GUJRAT ALKALIES AND CHEMICAL INDUSTRY


COMPANY BACKGROUD
Gujarat Alkalies and Chemicals Limited (GACL) was incorporated on 29th March, 1973 in the State of Gujarat by Gujarat Industrial Investment Corporation Limited (GIIC), a wholly owned company of Govt. of Gujarat, as a Core Promoter.

GACL has two units located at Vadodara and Dahej , both in the State of Gujarat. It has integrated manufacturing facilities for Caustic Soda, Chlorine, Hydrogen Gas, Hydrochloric Acid, Chloromethanes, Hydrogen Peroxide, Phosphoric Acid, Potassium Hydroxide, Potassium Carbonate, Sodium Cyanide, Sodium Ferrocyanide. The Dahej unit also has 90

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Fundamental & technical analysis of Chemical & Consumer Durables

MW Captive Power Plant (CPP) for regular and economical power supply.

The Company commenced its operations in 1976 with 37,425 MTPA Caustic Soda Plant based on the then, state-of-the-art Mercury Cell process at its Plant which is situated 16 km North of Vadodara near Village Ranoli on the main Railway track route between Ahmedabad and Mumbai.

Right from the inception, GACL has been following the strategy of continuous capacity expansion in core areas. The first stage expansion of the Caustic Soda Plant raising the capacity to 70,425 MTPA was undertaken in October, 1981 followed by a diversification programme to produce 2000 MTPA of Sodium Cyanide in December, 1982.

In 1984, the second stage expansion to increase the capacity of Caustic Soda Plant to 103,425 MTPA was undertaken. Simultaneously, the Company undertook the diversification project for manufacture of 10,560 MTPA of Chloromethanes using Chlorine, a co-product of the Company and in 1991, the capacity of Chloromethanes production was doubled.

As power is the major input for production of Caustic Soda and constitutes about 65% - 70% of the cost of production, the Company alongwith other Corporations like M/s. GSFC, Petrofils Co-operative Ltd. and Gujarat Electricity Board promoted a gas based power unit in Vadodara under the name of Gujarat Industrial Power Company Ltd. (GIPCL) during the year 1985. As a promoter of GIPCL, the Company gets low cost power, as the plant is gas based and is depreciated.

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Fundamental & technical analysis of Chemical & Consumer Durables

Since production of Caustic Soda is highly power intensive, in order to reduce power cost and to eliminate mercury pollution, the Company during the year 1989 converted one of its Cell Houses producing Caustic Soda from Mercury Cell Technology to environment friendly Membrane Cell Technology, thereby eliminating the use of mercury. The Capacity of Caustic Soda was also increased to 132000 MTA.

The conversion of second Mercury Cell to Membrane Cell was carried out during March, 1994, thereby eliminating the total use of mercury from the Complex for production of Caustic Soda and increasing the capacity of plant along with this conversion to 170000 MTA including Potassium Hydroxide facility.

As part of this Membrane Cell Conversion Project, a new facility for manufacture of 16500 MTA of Potassium Hydroxide Lye based on Membrane Cell was also set up. The Company has further set up facility for converting part of this Caustic Potash Lye into Potassium Carbonate with a capacity of 13200 MTA.

In order to add further value to its products, the company had set up manufacturing facility for production of 11000 MTA Hydrogen Peroxide (100%) at Vadodara Complex during the year 1996 to utilize Hydrogen gas, which is a co-product from Caustic Soda Process.

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Fundamental & technical analysis of Chemical & Consumer Durables

In 1995, as a part of diversification programme and to meet the growing demand of its products in the State of Gujarat and nearby areas, the Company had set up a plant for manufacture of Technical Grade Phosphoric Acid with capacity of 26400 MTA (85% Phosphoric Acid) at a new location at Dahej, District Bharuch. The Company also set up Membrane Cell based grass root Caustic-Chlorine Unit with a capacity of 100000 MTA at Dahej. Alongwith this, a captive 90 MW co-generation Power Plant was set up so as to ensure uninterrupted and low cost power for its captive operations.

INDUSTRY INFORMATION
Gujarat Alkalies and Chemicals Ltd is the single largest producer of Caustic Soda in India. The company is a multi-product company manufacturing 26 products. The company manufactures sodium cyanide, sodium ferrocyanide, chloromethanes, hydrochloric acid, caustic potash, potassium carbonate, phosphoric acid (85%) and hydrogen peroxide. The company has two units located at Vadodara (Baroda) and Dahej, both in the State of Gujarat. The company is associated with various industries viz. Textiles, Pulp & Paper, Soaps & Detergents, Alumina, Water Treatment, Petroleum, Fertilizers Pharmaceuticals, Agrochemicals, Dyes & Dyes Intermediates, etc through their products. Also, they made their felt across the globe even against stiff competition by exporting products to USA, Europe, Australia, Africa, Far & Middle East Countries, China and South Asian Markets. Gujarat Alkalies and Chemicals Ltd was incorporated in the year 1973 in Gujarat and was promoted by Gujarat Industrial Investment Corporation Ltd, a wholly owned company of Govt. of Gujarat, as a core promoter. The company commenced their operations in the year 1976, with 37,425 MTPA capacity of caustic soda at their plant in Vadodara. In October 1981, the first stage expansion of the caustic soda plant raising the capacity to 70,425 MTPA was undertaken, and in December 1982, a diversification programme to produce 2000 MTPA of Sodium Cyanide. In the year 1984, the second stage expansion to increase the capacity of caustic soda plant to 103,425 MTPA was undertaken. Also, the company undertook the diversification project for the manufacture of 10,560 MTPA of chloromethanes using chlorine, a co-product of the company. In March 1994, the conversion of second mercury cell to membrane cell was carried out, thereby eliminating the total use of mercury from the complex for the production of caustic soda. In order to add further value to their products, the company set up a manufacturing facility for production of 11000 MTA Hydrogen Peroxide at Vadodara in the year 1996 to utilize hydrogen gas, which is a co-product from caustic soda process. In the year 1995, as a part of diversification programme and to meet the growing demand of its products in the State of Gujarat and nearby areas, the company set up a plant for manufacturing technical grade phosphoric acid with capacity of 26400 MTA at Dahej. In the year 1998, the company set up membrane cell based caustic-chlorine unit with a capacity of 100000 MTA at Dahej. Also, a captive 90 MW co-generation power plant was set up so as to ARUNA MANHARLAL SHAH INSTITUTE MANAGEMENT & RESEARCH

NILESH DINESH WAGH

Fundamental & technical analysis of Chemical & Consumer Durables

ensure uninterrupted and low cost power for their captive operations. In the year 2000, the company commissioned caustic potash plant at Vadodara and in the year 2001, they increased the production capacity of hydrogen peroxide to 12540 MTA. During the financial year 2003-04, the company added a new product, namely anhydrous aluminium chloride in their product list. In September 2004, the company commissioned calcium chloride plant at Dahej. During the year 2004-05, the installation of 100TPD caustic soda flaking unit was completed and it commenced commercial production in April 2005. Also, the company set up 240TPD caustic evaporation facility during the year, which has commenced their commercial operation in May 2005. During the year 2006-07, the company completed the expansion of their caustic soda plant at Dahej by 200 TPD and commenced their production from June 26, 2006. Also, the company completed and commissioned two units of poly aluminium chloride, one at Baroda and another at Dahej. During the year 2007-08, the company successfully commissioned their 12540 Tpa hydrogen peroxide plant at Dahej in which the commercial production started in July 2007. The company successfully commissioned 50 TPD anhydrous aluminium chloride plant to create a captive consumption of chlorine at Dahej in which commercial production started in March 2008. During the year, the company commissioned additional 100 TPD caustic soda flaking plant at Dahej and commercial production started in January 2008. Also, they set up 23.75 MW wind energy farm in Kutch during the year. In April 2008, the company signed a joint venture agreement with DOW Europe GmbH for setting up a 2,00,000 TPA chloromethanes plant at Dahej at an cost of Rs 600 crore. In July 1, 2008, a joint venture company, namely Dow-GACL SolVenture Ltd was incorporated, which is expected to start their manufacturing operations by 2011.

NILESH DINESH WAGH

ARUNA MANHARLAL SHAH INSTITUTE MANAGEMENT & RESEARCH

Fundamental & technical analysis of Chemical & Consumer Durables

In January 2009, the company signed a MoU for setting up a joint venture company with Gujarat State Fertilisers & Chemicals Ltd and Gujarat Narmada Valley Fertilisers Company Ltd for manufacturing fine chemicals such as Phenol, Bisphenol, Polycarbonate, Butyl Rubber, Nitrile Butadiene Rubber, PBR, ABS, SBR, EDC and PVC at Dahej, in Gujarat. Also they singed a MoU with Gujarat State Fertilisers and Chemicals Ltd, Gujarat Narmada Valley Fertilisers Co Ltd and Gujarat Industrial Development Corporation for setting up a chemical park for small and medium enterprises (SMEs) to be formed jointly by those companies. The company has the plan to commission the projects, namely Sulphate Removal System, additional 100 TPD Flaker Unit, and additional 39 MW Wind Power Project in Kutch during the financial year 2008-09. The company is having a plan to expand caustic soda plant at Dahej by 50 TPD through Debottlenecking. Also, some of the projects, namely 90 MW captive power project, 600 TPD caustic soda project, hydrazine project, hydrogen peroxide, polyols project are under implementation. GACL is a forward-looking company, set up in the year 1973. 30 years is a long time. Long enough to test the character of any organization. Be it recession, inflation, increased competition or changing governments, we've lived it all. And for sure, all the turbulences have made GACL a stronger and a progressive company. Our stern resolve to manufacture quality chemicals and trek customer satisfaction to a new height has yielded unbelievable results. From an initial capacity of 37,425 TPA Caustic Soda, we have grown to be the largest producer in India, with a capacity of 3,58,760 TPA. Spread over 2 complexes at Vadodara and Dahej.

Knowing that the time ahead may prop-up newer hurdles, GACL has already started to diversify and expand its existing infrastructure to consolidate it's supremacy in Chlor-Alkali and other integrated downstream products.

WORLD CLASS TECHNOLOGY


Technology moulds generations. Our endeavor to continually upgrade technology has allowed us to optimize resources, thus bringing down the cost of production and increasing revenues. Acquired through the best and prestigious collaborations means that they meet international specifications for our products. Besides, our manufacturing plants are eco-friendly, which ensure that the environment is well looked after. The location of both the plants 'Vadodara' and 'Dahej' has dual advantage of proximity to the raw material suppliers and the end users. While the capacity utilization is about 70% in the Caustic Soda Industry, GACL's plants are working at almost 100% capacity.... thereby utilizing the assets to the fullest extent. Further the company takes pride in having honored it's commitments without fail. The company has made its presence felt across the globe even against stiff competition by exporting products to USA, Europe, Australia, Africa, Far & Middle East countries, China & South Asian Markets. NILESH DINESH WAGH ARUNA MANHARLAL SHAH INSTITUTE MANAGEMENT & RESEARCH

Fundamental & technical analysis of Chemical & Consumer Durables

GACL has adapted to the age of information technology for fast and uninterruptible information exchange. Both plants of Vadodara and Dahej are connected by VSAT and lease lines. This provides online information at any given point of time.

SELF-RELIANCE
Various factors that influence the success of any corporation, the self-sufficiency rank the foremost. We at GACL understand this all too well. Power, being a major input to the electrolytic Caustic Soda process, we promoted a joint captive power plant, Gujarat Industries Power Company Limited to meet our energy requirements for Vadodara Complex. Our complex at Dahej is also integrated with a captive cogeneration plant of capacity of 90 MW. Cost effective natural gas was substituted as fuel in place of Naphtha for Captive Power Plant. The plant load factor has increased and surplus power is supplied to State grid. This has helped achieve economies of operations.

GREEN ALL THE WAY


Nature bestows human race with umpteen benefits. Clean air, Lush green trees, GACL's commitment towards the environment is undying. Safe and unadulterated nature is high on our list of priorities; we are an organization with Green Attitude. A dedicated senior executive heads a Safety and Environment Department to maintain high standards of safety and a harmonious relationship between environment and technology. The company has planted more than 1,00,000 plants and it keeps maintaining the same. With tree plantation being a regular feature, it plants 1000 sapling every year. Rainwater harvesting and collection is a part of routine activity at GACL. This water is then utilized for the maintenance of green belts. The vermiculture concept has been implemented in the premises to convert waste generated by the canteen, gardens and plants to vermicompost. GACL has been a pioneer in adopting the environment friendly and energy efficient technologies. It converted to Membrane Cell Technology from Mercury Cell Technology way back in 1989 and since 1994 all the plants are running on Mercury free Membrane Cell Technology. As a matter of strategy, the company has placed sensors at strategic locations in and around the complex to monitor ambient air quality. For disposal of solid waste, GACL has secured dedicated landfill site conforming to the hazardous Waste Management Act. Being a member of Effluent Channel Project, it releases it's liquid effluent in this NILESH DINESH WAGH ARUNA MANHARLAL SHAH INSTITUTE MANAGEMENT & RESEARCH

Fundamental & technical analysis of Chemical & Consumer Durables

channel and adheres to the necessary parameters of the Gujarat Pollution Control Board before discharging it into the channel.

PEOPLE : OUR VALUED ASSETS


World-class technology and self-reliance are baseless without brains that work ardently to produce high quality chemicals. People are our real assets, whom we nurture and harness to get the very best out of them. Our conviction is : People make the organization. A sense of belonging is a must for dedication and loyalty. Employees give their best when the company cares for them. Ethical and transparent operations have contributed to a very great extent in bringing a turnaround at GACL. Excellent labour relationship helped the company in achieving very high manpower production turnover per employee per annum. This is also a result of a thin and lean workforce , which is lead by the professional management.

SPREADING OUR WINGS


The unshakeable desire to deliver quality products to our customers means that our products are well accepted, both in India and the world over. Domestic customers are assured of prompt delivery of quality products at their doorsteps through our well-established network of dealers and consignment stockists. Overseas customers are serviced directly or through agents. Caustic-Chlorine being it's prime product, the company has diversified into value added products like Sodium Cyanide, Chloromethanes, Hydrogen Peroxide, Potassium Carbonate, Phosphoric Acid, etc. These value added products provide dual benefit to the organization by hedging against cyclical fluctuations in the Chlor-Alkali Industry. GACL sells 24 products today, maintaining it's leadership in Caustic-Chlorine industry with 16% market share and has emerged as a major player in the segment of value added products.

THE ZEST TO INVENT


The mercurial nature of the chemical industry demands continuous invention and innovation. We have a well-equipped R & D centre, recognized by the department of Science and Technology, Government of India, working on new and safer processes/ technologies, value added products and import substitutes. We are the proud recipients of national awards for : Excellence in research and development from the department of Science and Technology, Government Of India. NILESH DINESH WAGH ARUNA MANHARLAL SHAH INSTITUTE MANAGEMENT & RESEARCH

Fundamental & technical analysis of Chemical & Consumer Durables

Pollution Control and Environment Protection from Chemtech Foundation for developing a process for manufacturing Sodium Ferrocyanide from the waste stream Sodium Cyanide process. Novel energy conservation and integration programme in chemical plant from the Indian Chemical Manufacturers Association. GACL is a pround recipient of "National Energy Conservation Award" by Bureau of Energy Efficiency (BEE),Ministry of Power, Govt. of India for three consecutive years since 2004.

At Dahej, the system to recover Calcium Chloride from waste of the Phosphoric Acid Plant reduces the discharge of aqueous effluent to the sea.

QUALITY MATTERS
We are committed to utmost customer satisfaction, which is the driving force for progress. Adhering to international standards, with no laxity in any sphere, we are successfully a favoured supplier for our range of products. To consolidate this and to gain international credibility, we had obtained quality system certificate under IS/ISO 9001:2000, ISO 14001:1996 and IS 18001:2000.

VISION
To continue to be identified and recognized as a dynamic, modern and eco-friendly chemical company with enduring ethics and values. Mission To manage our business responsibly and sensitively, in order to address the needs of our Customers and Stakeholders. To strive for continuous improvement in performance, measuring results precisely, and ensuring GACLs growth and profitability through innovations. To demand from ourselves and others the highest ethical standards and to ensure products and processes to be of the highest quality.

MISSION
To manage our business responsibly and sensitively, in order to address the needs of our Customers & Stakeholders. To strive for continuous improvement in performance, measuring results precisely, and ensuring GACL's growth and profitability through innovations. To demand from ourselves and others the highest ethical standards and to ensure products and processes to be of the highest quality.

AWARDS AND RECOGNITIONS :


NILESH DINESH WAGH ARUNA MANHARLAL SHAH INSTITUTE MANAGEMENT & RESEARCH

Fundamental & technical analysis of Chemical & Consumer Durables

The Company is a proud recipient of the following recognitions and awards during the year: 1. ICWAI Excellence in Cost Management Award 2010 awarded to our Vadodara Complex by The Institute of Cost and Works Accountants of India in July, 2011. 2. National Safety Award-2009 awarded to our Dahej Complex for the safety record by Ministry of Labour & Employment, Govt. of India in November, 2011.

GACI MANAGEMENT
You can view name of Chairman, CEO, CFO, Management Team, Board of Directors and Key Executives of Gujarat Alkalies & Chemicals Ltd.

Name NILESH DINESH WAGH

Designation ARUNA MANHARLAL SHAH INSTITUTE MANAGEMENT & RESEARCH

Fundamental & technical analysis of Chemical & Consumer Durables

D J Pandian G C Murmu G M Yadwadkar H B Patel Hasmukh Adhia J N Godbole M S Dagur M S Dagur Sukh Dev V L Vyas V L Vyas Varesh Sinha

Director Director Director Chief Financial Officer Director Director CEO Managing Director Director Chief General Manager & Co. Secretary Secretary Chairman

STRENGTHS, OPPORTUNITIES & THREATS AND RISKS & CONCERNS:

SWOT Analysis 1. Production capacity of 1087 TPD or 3,58,760 TPA, with decades of experience in the Caustic-Chlorine industry. 2. Export sales in regions of Europe, North America, Middle East, Australia, parts of South-East Asia and China. 3. Manufacturing complexes in Vadodara and Dahej are in close proximity to raw material sources and well-connected by VSAT and lease lines. 4. Received many national awards such as National Energy Conservation Award by the Bureau of Energy Efficiency (BEE), Ministry of Power, Govt. of India and award for Excellence in R&D from the Dept. of Science & Technology, Govt. of India, to name a few. 1. Caustic soda sales have been very volatile and has affected profits 2. There have been many allegations of labor strikes due to unchanged wage patterns 1. Large scale investments , thereby expanding market share. 2.Investments in South Gujarat with set-up of Hydrogen Peroxide facilities of capacities up to 14,000 TPA and bleaching powder manufacturing units with capacities of up to 15,000 TPA. ARUNA MANHARLAL SHAH INSTITUTE MANAGEMENT & RESEARCH

Strength

Weakness

Opportunity NILESH DINESH WAGH

Fundamental & technical analysis of Chemical & Consumer Durables

Threats

1. Labor laws and regulations are becoming increasingly antimanagement. 2. Trade to international locations has hit an all-time low with prices reaching the ceiling. 3. The chlorine industry is in a decline stage due to alternate chemicals and cheap resources.

The strengths of the Company are economies of scale, state of the art eco-friendlytechnologies, economical and uninterrupted power from GIPCL at Vadodara and Captiveco-generation plant at Dahej, extensive usage of renewable energy, Integrated down streamplants, strong network for Marketing and Distribution, In-house Research and Developmentfacilities, Proximity to Raw material source and markets etc. The Company has grown rapidly and sustained its performance. The Company has adoptedits a strategy to concentrate both on top and bottom lines. The contributing factorsto Companys success are optimizing of operations, better marketing, close monitoringand control of financial cost, increase in efficiency of plants, timely and successfulcompletion of expansion projects/manufacturing of new products etc. The manpower of theCompany with high morale and motivation always endeavours to bring better results. Keepingin view, the current trends of Indian and global economy, the time ahead may prop-up newerhurdles. To overcome such hurdles, the Company has planned new projects involvinginvestments of over `2,600 Crores during next 3 to 4 years, to diversify, add newproducts, enlarge portfolio and expand its existing capacities. It will also enable us toconsolidate and maintain our leadership in Chlor-Alkali and other integrated downstreamproducts. Our continuous efforts to upgrade the technology has enabled us to optimize thecost of production and increasing revenues. Our commitment to deliver quality products tothe customers has ensured that its products are well accepted, both in India and worldover. The customers are assured of prompt delivery of quality products through itswell-established network of dealers and consignment stockists. The Company is operating ina competitive market both in domestic and international sector. However, the increasingcost of gas and power, rock-phosphate and Potassium Chloride etc. are the areas ofconcern. The Companys total Wind Energy Generation Capacity has now gone up to 83.75MW in Gujarat, to augment its power requirement. Some of our competitors also havelocational advantages. In the international market, the Company competes withmanufacturers in China and Middle East, who have their own typical advantages.Domestically, the Import of several items is becoming cheaper with reduction in customduty. Alkali products have to face competition from imports with reduction in custom duty.To protect from unfair competition for products like Caustic Soda Lye/Flakes and PotassiumCarbonate, the Indian manufacturers had approached the Designated Authority to imposeAnti-dumping duty against such imports and Anti-dumping duty has been imposed on importsof these products from various countries. The Company also produces Carbon Tetrachloride (CTC) at Vadodara Plant. The productcomes under Ozone Depletion Substance (ODS) Rules (2000) as per the guidelines under theMontreal Protocol framed by Government of India. Under these Rules, CTC for non-feed stockapplication is to be phased out by 2010, however, production of CTC for feed stockapplication shall continue. The Company has taken adequate steps to meet the saidguidelines.

NILESH DINESH WAGH

ARUNA MANHARLAL SHAH INSTITUTE MANAGEMENT & RESEARCH

Fundamental & technical analysis of Chemical & Consumer Durables

Key inputs required for power plant and Vadodara Plant for process and steam generationis NG/RLNG. The Government of India has appointed the Tariff Commission to fix the priceof NG/RLNG. The Company has entered into contracts for supply of NG/RLNG with M/s. GAILand GSPC. M/s. GAIL has been substantially and unilaterally raising the price of RLNG,which has increased the cost of our power generation. All Chemical products generally passthrough cyclic phase. While some products are in short supply, some others do not movesatisfactorily. Owing to availability of 26 products in its basket, the Companycontinuously endeavours to leverage products in short supplies against slow movingproducts. Your Companys products / product groups viz., Phosphoric Acid andPotassium group (Potassium Hydroxide, Potassium Flakes, Potassium Carbonate-K2CO3)are under threat of rise in raw material prices due to its scarcity in the globalmarket. The Company has only single channel procurements for the raw materials for theabove finished goods, namely Rock Phosphate from Jordan and Potassium Chloride fromCanada. Efforts are on to search for other suppliers of these materials of technicalsuitability for the designed plant at present, through domestic dealers / foreignsupplier.

RATIO ANALYSIS
Company Name
Income Statement Revenue Cost of Goods Sold Interest Expense Tax Expense Income from Cont Operations PBIT Depreciation Purchases Gross Profit Net Income Balance Sheet Cash Short Term Investments Current Year $ 172,274 148,313 1,936 5,842 171,097 383 139 886 39,909 15,361 Percent 100.0% 86.1% 1.1% 3.4% 99.3% Prior Year $ 144,669 131,970 1,989 1,588 143,468 279 133 1,604 28,127 11,430 Percent 100.0% 91.2% 1.4% 1.1% 99.2% 3 Years Ago $ 132,353.00 4 Years Ago $ 143,612.00 5 Years Ago $ 120,034.00

8.9%

7.9%

5,789 263

2.0% 0.1%

1,726 263

0.7% 0.1%

NILESH DINESH WAGH

ARUNA MANHARLAL SHAH INSTITUTE MANAGEMENT & RESEARCH

Fundamental & technical analysis of Chemical & Consumer Durables

Accounts Receivable Trade payable Inventory Current Assets Long Term Investments Net Fixed Assets Other Assets Total Assets Current Liabilities Total Liabilities Debt(long & short borrow) Stockholders' Equity Cash Flow Cash Flow from Operations Dividends Paid Interest Paid Per Share No. of shares Market Price at Year End BookValue Earnings Per Share - Basic

25,044 8,088 17,893 39,941 15,845 164,275 13,505 282,554 61,898 282,554 311 160,779

8.9% 6.3% 14.1% 5.6% 58.1% 4.8% 100.0% 21.9% 100.0% 0.1% 56.9%

27,561 7,714 13,006 35,695 15,354 156,889 12,199 262,697 64,644 262,697 352 147,978

10.5% 5.0% 13.6% 5.8% 59.7% 4.6% 100.0% 24.6% 100.0% 0.1% 56.3%

34,661 2,561 1,944

19,277 2,569 1,845

734.40 121.55 218.93 20.92

734.40 126.50 218.93 15.56

RATIO ANALYSIS Growth Ratios Sales Growth Income Growth Asset Growth Activity Ratios Receivable Turnover Inventory Turnover Fixed Asset Turnover Profit Ratios Profit Margin Return on Assets Return on Equity Dividend Payout Ratio Price Earnings Ratio Liquidity Ratios Current Ratio Quick Ratio Solvency Ratios

19.1% 19.3% 7.6% 6.5 9.6 1.0 99.3% 62.8% 110.8% 16.7% 5.8 0.65 0.50

9.3% #DIV/0! #DIV/0! 10.5 20.3 0.9 99.2% 109.2% 193.9% 22.5% 8.1 0.55 0.46

NILESH DINESH WAGH

ARUNA MANHARLAL SHAH INSTITUTE MANAGEMENT & RESEARCH

Fundamental & technical analysis of Chemical & Consumer Durables

Debt to Total Assets Times Interest Earned (Accrual) Times Interest Earned (Cash)

1.00 92.38 18.83

1.00 73.93 11.45

Shareholder equity ratio Debt service coverage ratio Interest coverage ratio Debtors collection period Payable turnover Creditor's payment period Gross profit margin Market price to book value Dividend per share Dividend yield ratio Debt to Equity

8.985623 0.197856 55.7277 0.11212 3255.444 0.23166 10.46511 3.486538 0.004747 0.001937

11.37793 0.140268 34.76861 0.415947 877.5151 0.194423 14.07005 3.498126 0.004763 0.00238

REVENUE TREND
REVENUE TREND

$200,000 $150,000 $100,000 $50,000 $0 5 Years Ago4 Years Ago3 Years Ago Prior Year Current Year

NILESH DINESH WAGH

ARUNA MANHARLAL SHAH INSTITUTE MANAGEMENT & RESEARCH

Fundamental & technical analysis of Chemical & Consumer Durables

INCOME TO CASH FLOW COMPARISON


$180,000 $160,000 $140,000 $120,000 $100,000 $80,000 $60,000 $40,000 $20,000 $0 3 Years Ago Prior Year Current Year
Income Continuing Operations

Cash Flow from Operations

TECHNICAL ANALYSIS
ONE YEAR TECH CHART OF GUJARAT ALKALIES & CHEMICALS Ltd.

NILESH DINESH WAGH

ARUNA MANHARLAL SHAH INSTITUTE MANAGEMENT & RESEARCH

Fundamental & technical analysis of Chemical & Consumer Durables

NILESH DINESH WAGH

ARUNA MANHARLAL SHAH INSTITUTE MANAGEMENT & RESEARCH

Fundamental & technical analysis of Chemical & Consumer Durables

CANDLESTICK CHARTS & RECENT PATTERNS OF GUJARAT ALKALIES CHEMICALS Ltd

REASONS TO BUY

Gain key insights into the company for academic or business research purposes. Key elements such as SWOT analysis, corporate strategy and financial ratios and charts are incorporated into the profile to assist your academic or business research needs. Identify potential customers and suppliers based on the analysis of the companys business structure, operations, major products and services and business strategy. Understand and respond to your competitors business structure and strategies with GlobalDatas detailed SWOT analysis. It analyzes the companys core strengths, weaknesses, opportunities and threats, providing you with an up-to-date objective view of the company. Examine potential investment and acquisition targets with this reports detailed insight into the companys strategic, financial and operational performance. Financial ratios presented for major public companies in the report include revenue trends, profitability, growth, margins and returns, liquidity and leverage, financial position and efficiency ratios.

NILESH DINESH WAGH

ARUNA MANHARLAL SHAH INSTITUTE MANAGEMENT & RESEARCH

Fundamental & technical analysis of Chemical & Consumer Durables

RECOMMENDATION
The data of both the companies are been compared below:-

PRIMARY COMPETITOR ANALYSIS


Company $ Income Statement Revenue Cost of Goods Sold Interest Expense Tax Expense Income from Cont Op PBIT Depreciation Purchases Gross Profit Net Income Balance Sheet Cash Short Term Investments Accounts Receivable Trade Payable Inventory Current Assets Long Term Investments Net Fixed Assets Other Assets Total Assets Current Liabilities Total Liabilities Stockholders' Equity Prior Year Accounts Receivable Prior Year Inventory Prior Year Assets Prior Year Equity Cash Flow Cash Flow from Operations Dividends Paid 8,268 7,370 190 210 7,987 1,199.22 225 2,168 2,955 587 Competitor $ 1,723 1,483 58 154 4 1 9 399 154

892 0 1,486 1,253 349 4,614 2,075 205 10,875 3,416 10,875 5,017 724 696 9,496 4,741

58 3 250 81 179 399 158 1,643 135 2,826 619 2,826 1,608 276 130 2,627 1,479

341 292

347 26

NILESH DINESH WAGH

ARUNA MANHARLAL SHAH INSTITUTE MANAGEMENT & RESEARCH

Fundamental & technical analysis of Chemical & Consumer Durables

RATIO ANALYSIS Income Statement Common Size Data Gross Profit/Sales Income from Continuing Operations/Sales Balance Sheet Common-Size Data Current Assets/Total Assets Current Liabilities/Total Assets Liabilities/Total Assets Equity/Total Assets Profit Ratios Profit Margin Return on Assets Return on Equity Dividend Payout Ratio Liquidity Ratios Current Ratio Quick Ratio Solvency Ratios Liabilities/Total Assets Times Interest Earned (Accrual) Operational Ratios Receivable Turnover Inventory Turnover

10.9% 96.6% 3.2% 31.4% 100.0% 46.1% 96.6% 78.4% 163.7% 49.8% 0.10 0.70 1.00 44.16 7.5 7.6

13.9% 8.9% 14.1% 21.9% 100.0% 56.9% 8.9% 5.6% 10.0% 16.7% 0.65 0.50 1.00 3.63 6.5 9.6

After comparing tata chemicals with gujrat alkalies we can recommend that it is better to buy the shares of tata chemicals because its profit marjin is higher than that of GACI.

NILESH DINESH WAGH

ARUNA MANHARLAL SHAH INSTITUTE MANAGEMENT & RESEARCH